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1. rtsil+(OP)[view] [source] 2023-11-22 12:23:44
> IPOed around 2006 and now has a MC of ~ $10 billion.

The interesting thing is you used economic values to show their importance, not what innovations or changes they achieved. Which is fine for ordinary companies, but OpenAI is supposed to be a non-profit, so these metrics should not be relevant. Otherwise, what's the difference?

replies(3): >>matwoo+E >>infect+s3 >>robert+4h
2. matwoo+E[view] [source] 2023-11-22 12:28:18
>>rtsil+(OP)
> OpenAI is supposed to be a non-profit, so these metrics should not be relevant

You're doing the same thing except with finances. Non-profit doesn't mean finances are irrelevant. It simply means there are no shareholders. Non-profits are still businesses - no money, no mission.

replies(1): >>brooks+Nl
3. infect+s3[view] [source] 2023-11-22 12:51:07
>>rtsil+(OP)
How do you do expensive bleeding edge research with no money? Sure you might get some grants in the millions but what if it takes billions. Now lets assume the research is no small feat, its not just a handful of individuals in a lab, we need to hire larger teams to make it happen. We have to pay for those individuals and their benefits.

My take is its not cheap to do what they are doing and adding a capped for-profit side is an interesting take. Afterall, OpenAI's mission clearly states that AGI is happening and if thats true, those profit caps are probably trivial to meet.

4. robert+4h[view] [source] 2023-11-22 14:08:57
>>rtsil+(OP)
> he interesting thing is you used economic values to show their importance, not what innovations or changes they achieved

Money is just a way to value things relative to other things. It's not interesting to value something using money.

replies(1): >>Doughn+kp
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5. brooks+Nl[view] [source] [discussion] 2023-11-22 14:27:49
>>matwoo+E
Well said. And to extend, there being no shareholders means that no money leaves the company in the form of dividends or stock buybacks.

That’s it. Nonprofit corporations are still corporations in every other way.

replies(1): >>rvnx+Hn
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6. rvnx+Hn[view] [source] [discussion] 2023-11-22 14:35:49
>>brooks+Nl
Yes, but non-profit doesn't mean non-money.

You can get big salaries; and to push the money outside it's very simple, you just need to spend it through other companies.

Additional bonus with some structures: If the co-investors are also the donators to the non-profit, they can deduct these donations from their taxes, and still pocket-back the profit, it's a double-win.

No conspiracy needed, for example, it's very convenient that MSFT can politely "influence" OpenAI to spend back on their platform a lot of the money they gave to the non-profit back to their for-profit (and profitable) company.

For example, you can create a chip company, and use the non-profit to buy your chips.

Then the profit is channeled to you and your co-investors in the chip company.

replies(1): >>ric2b+Yr3
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7. Doughn+kp[view] [source] [discussion] 2023-11-22 14:42:46
>>robert+4h
It is absolutely curious to talk about profit when talking about academic research or a non-profit (which OpenAI officially is).

Sure, you can talk about results in terms of their monetary value but it doesn’t make sense to think of it in terms of the profit generated directly by the actor.

For example Pfizer made huge profits off of the COVID-19 vaccine. But that vaccine would never have been possible without foundational research conducted in universities in the US and Germany which established the viability in vivo of mRNA.

Pfizer made billions and many lives were saved using the work of academics (which also laid the groundwork for future valuable vaccines). The profit made by the academics and universities was minimal in comparison.

So, whose work was more valuable?

replies(1): >>robert+ez
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8. robert+ez[view] [source] [discussion] 2023-11-22 15:23:40
>>Doughn+kp
No one mentioned profit, I think.
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9. ric2b+Yr3[view] [source] [discussion] 2023-11-23 11:05:23
>>rvnx+Hn
> No conspiracy needed, for example, it's very convenient that MSFT can politely "influence" OpenAI to spend back on their platform a lot of the money they gave to the non-profit back to their for-profit (and profitable) company.

Can you explain this further? So Microsoft pays $X to OpenAI, then OpenAI uses a lot of energy and hardware from Microsoft and the $X go back to Microsoft. How does Microsoft gain money this way?

replies(1): >>matwoo+AN3
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10. matwoo+AN3[view] [source] [discussion] 2023-11-23 14:07:47
>>ric2b+Yr3
MS gains special access and influence over OpenAI for effectively 'free'. Obviously the compute cost MS money, and some of their 'donation' is used on OpenAI salaries, but still. This special access and influence lets MS be first to market on all sorts of products - see co-pilot already with a 1M+ paying subscribers.

For example, let's say I'm a big for-profit selling shovels. You're a naive non-profit who needs shovels to build some next gen technology. Turns out you need a lot of shovels and donations so far haven't cut it. I step in and offer to give you all the shovels you need, but I want special access to what you create. And even if it's not codified, you will naturally feel indebted to me. I gain huge upside for just my marginal cost of creating the shovels. And, if I gave the shovels to a non-profit I can also take tax write-offs at the shovel market value.

TBH, it was an amazing move by MS. And MS was the only big cloud provider who could have done it b/c Sataya appears collaborative and willing to partner. Amazon would have been an obvious choice, but they don't partnership like that and instead tend to buy companies or repurpose OSS. And Google can't get out of their own way with their hubris.

replies(1): >>ric2b+8ec
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11. ric2b+8ec[view] [source] [discussion] 2023-11-26 21:41:58
>>matwoo+AN3
Ok, but does any of this have to do with tax avoidance? I thought that was what you were talking about, no?

Because what you just described would happen the same way with a for-profit company, no?

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