Here's why OpenAI might delay their IPO
The speaker discusses OpenAI's likely IPO timeline, predicting it will occur before the second half of 2027, probably in Q3/Q4 2026 or Q1/Q2 2027. Multiple business initiatives (super app, ads, hardware) must succeed and the executive team may need restructuring for the IPO to proceed, though the speaker views it as inevitable given the company's substantial funding.
Summary
The speaker expresses confidence that OpenAI will eventually go public, despite potential obstacles that could delay or complicate the process. Key uncertainties include the performance of Anthropic's ARR, the viability of OpenAI's super app strategy, success of their advertising business model, and hardware initiatives. The speaker also notes that executive team restructuring may be necessary before an IPO. However, the speaker believes these challenges won't prevent an IPO from occurring, viewing it as the natural endpoint given OpenAI's substantial capital raises. The timing is expected to be sometime in 2026 (Q3 or Q4) or early 2027 (Q1 or Q2), with the speaker expressing shock if it were delayed to the second half of 2027. The discussion also touches on SpaceX as a comparative case study, noting its massive IPO pop followed by a significant decline in stock price. The speaker mentions SpaceX currently trades at a $2.16 trillion valuation and questions whether this represents a good outcome relative to the company's revenue, while acknowledging that Sam Altman may have been influenced by SpaceX's IPO experience and subsequent performance in forming OpenAI's approach to going public.
Key Insights
- The speaker believes OpenAI must eventually go public because the company has raised too much capital, making an IPO the natural endpoint of its funding trajectory
- Multiple critical initiatives must succeed for OpenAI's IPO story to remain intact: the super app strategy, advertising business, hardware products, and potentially executive team changes
- The speaker predicts OpenAI's IPO will occur before the second half of 2027, most likely in Q3/Q4 2026 or Q1/Q2 2027, with would be shocked by any delay beyond that timeframe
- Sam Altman's IPO strategy may have been influenced by SpaceX's experience, which saw a massive stock pop on IPO day followed by a subsequent crash, potentially making OpenAI leadership cautious about public markets
- OpenAI plans to conduct an employee tender offer soon as an interim liquidity event before pursuing a full IPO
Topics
Transcript
[0:00] I would be shocked if it was in the second half of 2027. Anthropics ARR could crater and then the story is not there. OpenAI super app thing could not work. Ads could not work. The hardware could not work. May need to redo the executive bench, right? There's there's a lot of things that they have to get through. I do think they will IPO. I would be shocked if it was in the second half of 2027. I think it will be before that, whether that's Q3, Q4 or Q1, Q2 next year. But we are going to get an IPO because you kind of have to. They've raised too much money. I mean, this is the…
Full transcript available for MurmurCast members
Sign Up to AccessMore from Prof G Markets
OpenAI doesn't have it's s*** together
OpenAI has delayed its IPO plans until 2027 after confidentially filing in June, reportedly due to fallout from SpaceX's rocky public debut. Meanwhile, competitor Anthropic is accelerating its own public offering timeline, with betting odds suggesting a 76% probability of Anthropic going public this year. The commentary suggests OpenAI's leadership lacks strategic clarity on managing public perception around its IPO plans.
Scott Galloway doesn't have any insurance?
Scott Galloway explains his decision to self-insure rather than purchase auto, property, life, or health insurance, arguing that insurance is fundamentally a wealth transfer mechanism from poor to rich. He points out that only 55 cents of every insurance dollar returns to consumers while 45 cents goes to profits and administration, though he acknowledges the system creates a paradox where people prefer guaranteed small losses over potential catastrophic ones.
Elon Musk did this to engineer SpaceX's IPO?
The speaker explains how artificial scarcity is used as a business strategy to maintain high profits and demand, citing examples from Porsche and Rolex, and argues that SpaceX employed a similar tactic with a minimal IPO float of 4%.
Euphoria Has Taken Over The Markets
The discussion centers on the current euphoric state of the markets, particularly driven by companies like SpaceX, and reflects on the implications of wealth accumulation and distribution. Barry Ritholtz offers insights into market behavior, investor psychology, and historical trends, emphasizing the potential risks and volatility ahead.
Rest in peace Snapchat?
Snap's stock has plummeted over 90% in five years, and the company has invested an estimated $3.5 billion—over half its annual revenue—into developing Snap Spectacles, a heavily criticized wearable device. The speaker argues this massive bet on an unpopular product may be the final blow for the struggling company.