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OpenAI Is Poised to Become the Most Valuable Startup Ever. Should It Be?


The AI startup is chasing a $500 billion valuation, with backers betting it can become the next Apple or Google. There are reasons for skepticism.

“The half a trillion dollar question now is, to what extent will OpenAI be able to retain the customers that it has acquired, and simultaneously be able to bring its costs to a point where it can, in fact, monetize at [hypothetically] $5 per user per month,” says Arun Sundararajan, a professor at New York University’s Stern School of Business. For investors buying in at $500 billion, “they’re expecting an IPO above a trillion in two to three years, otherwise the rate of return does not justify the investment,” says Glenn Okun, who’s also a business professor at NYU. But in classic Altman fashion, he reminded attendees that’s actually a good thing: “When bubbles happen, smart people get overexcited about a kernel of truth,” he said.

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