YHK - yet another hacker news clone

I want to see this go out at $800b. I do not believe even $1T will be supported by public markets unless they shrink the float — but that also comes with its own risks.

Honestly crazy that we’re doubting 1T, even with all the capital issues behind it.

I’m not making a bigger argument other than I disagree with that one datapoint you mentioned.

Unsafe, comprehension debt, vibecoding, slop? Have you seen actual lowly developers’ code? AI is a vast, vast improvement on all relevant axes if you ask me.

If you think this is going to slow down I have no idea what to tell you.

The IPOs need to have buyers. The buyers will have some idea of the business valuation, as will the sellers. This is decided before the actual stock starts trading.

Specifically, the "underwriters" will go around finding people willing to buy what is being offered. This gives some idea of where it will begin to trade.

If your broker allocates you shares, you pay the IPO price as does everyone else who was allocated shares. The shares are all allocated before the IPO happens and once it opens for trading, price discovery happens.

How the price is set is another matter, one I’m not familiar with as an amateur.

The stock exchange is a "secondary market", which means you're buying stock from investors who own it, not from the company itself.

Most of the institutional and retail placements happen on the initial valuation. These are the people who are holding the shares when it gets listed and starts trading, and it is the primary source of raising capital through an IPO.

To go further though the Initial Valuation (usually a range) is set weeks before the IPO to make it easier to pitch to investors. And the final valuation is locked in the night before trading based on actual demand.

The opening price on the stock exchange, though, will be whatever the demand and supply is in pre-market trading/open.

Ultimately the percentage of shares that public will trade is material. say 20% for $100B is quite different from 10% for $100B.

If they are too far below the perceived value, they are leaving significant money on the table.

If they are too high, the institutions who participate in IPOs will let them know. If the price craters off IPO it is not good for perception of the stock, and so ongoing health of the company even if that maximizes private investor value at IPO.

So they build a book of commitment around the target value, trying to leave enough incentive (15-20%, often) of an initial bump to get big money in.

They get the money from the initial purchase of the shares, and never get another dime directly from the market again, unless they have another offering (which is quite possible). The stock price does drive leverage for later M&A and debt/credit activities, and matters to stock-based compensation, so it does have meaning, but the IPO provides a one-time cash infusion at the initial price.

If one of the initial buyers sells in the first minute the company is public the first publicly traded shares at 1.5x their purchase price, the company suddenly has a market cap of $1.5 trillion instead of $1 trillion, and that buyer has made a tidy 50% profit on the shares they just sold. If all initial buyers dump a bunch of their shares the price likely will go down, perhaps pushing the market cap to, say, $750 billion. Regardless of this action on the first day and after, the company offering their shares still has the $100 billion.

Note that initial buyers are discouraged from selling large portions of their shares.

If the pop is too big, that means the company left money on the table.

If the pop is too small, the investment banks that underwrite the IPO have to worry about losing money.

The trading price you see on the screen is - shortly afterwards the shares become publicly tradable on the exchange (or on all US equities exchanges, for US stocks). So in effect, the price shooting up on the public markets is actually bad for the company in that they might have left money on the table.

E.g. SpaceX is currently trading below its IPO price. If you became a shareholder by buying at IPO and held your have lost money as of today.

Since they actually have paying customers, it's a completely different sort of thing than for Meta. The question is instead whether they can keep at the frontier, whether the compute they've signed up for is good enough, etc.

Caveats: It's hard to believe that this growth rate would continue. And Meta's numbers above are trailing 12 months, while Anthropic's are annualized run rate.

If datacenter production sees significant headwind then it’s very bad for ANT. Securing compute is listed as one of their major risks to the SEC.

Outside of programming and a couple of other sectors I’m not sure that is true. It isn’t visible in the unemployment figures.

You really don't know what we have here, do you? Let me illustrate what you can do with Qwen3.8@q4 locally with about 2TB of storage and a small cloud server to host a website.

Locally you scrape and process every elected official and start tracking what they're doing, what they're promising, and what they're not doing. You build embeddings and make them all geotagged in a database and just start with the largest cities.

The website provides public facing search. User drops in a zipcode, city, state, specific rep's name and gets what's relevant to their results.

All of this is to say, we literally have the technology to hold accountable our representatives and then show everyone objectively who's doing good and bad for their constituents.

It wont take much to solve the problem of bad representation after these last two years. The hard part is literally making sure people going to a polling station can immediately know who the heck the 10 - 30 different people are they're voting for, and track them efficiently within their own specific parameters.

Regulation is coming for more than just the inference providers.

That said, I'm also somewhat skeptical that there is even much room for growth left unless somebody finds a new, important, and token-hungry use case.

I am highly confident that Anthropic will 100X their token sales volume. I am also confident that token prices will continue dropping through the floor due to competition. So to 100X their revenue they will have to 1000X or 10000X their token sales. That seems a stretch.

What's you're point there? People laid off because of AI will immediately shift into AI-centric small business, and start hyping AI?

That doesn't make sense to me. People being laid off are likely to be bitter about the cause of their layoff, and even if they all start their own businesses (which is unlikely), most of those will fail, leading to more bitterness.

Agree. these valuations will hold. Pundits made the same prediction after Facebook's IPO in 2012 that everything would soon crash. here we are...

That's why it's dropping here. When the actual stock market tanked yesterday institutional investors were like - hey wait a minute this is starting to look too expensive.

Also if your 401(k) is in index funds you are safe. A company is not added to indices right away. If you are in actively managed funds or something like that you might have more exposure risk.

Markets have the advantage that many peoples' opinions are aggregated into the market price. This is far, far more accurate than having one person's opinion (an elected bureaucrat) set the price, particularly when they have no skin in the game.

If the IPO price is really 10x the public market price, that implies that the set of institutional investors collectively estimated the price 10x higher than the full set of retail investors. That's pretty unlikely: institutional investors usually do pretty extensive due diligence on IPOs, and you're already averaging out the statistical fluctuations by selling to a wide set of them. But if that does happen, it just means that institutions got fucked over to the benefit of retail (who gets a 90% discount on the same shares), which seems like something we should be celebrating.

So many people who don't actually read and evaluate things but just buy stocks based on vibes and what they see on Twitter. Which is to say, the same people that buy and lose money on most IPOs.

The market anticipates the unlocking; when the shares become public, buyers swoop in, so the stock decline is much less than expected, if at all. There is no new information here. If everyone is expecting shares to unlock, then it’s priced into the market accordingly.

Scaled from 0 to $65 billion in revenue in 5 years...

Until there is a large free US model, its Ant and OAI.

So many people 6-12 months ago predicted Space-X stock would crash and burn, yet the stock is still holding strong around $130 and a valuation over a trillion dollars.

You’re also missing the competition aspect. What if other companies have their own super genius slaves to sell at a cheaper price? What if open models allow anyone to have their own moderately genius slave at far less expense?

Whoever is claiming that is an idiot.

And if they haven’t created an artificial superintelligence then they start to look more like just another tech startup with no moat[1] and a terrible balance sheet.

[1] I don’t know about you, but I switch model providers multiple times per day.

Like seat-of-the-pants good as Opus 5.5 but a bit slower and required just a bit more prompting to get what I wanted (which is fine for an app pipeline).

I feel like the industry hasn't solved that alignment problem yet... We have no way to verify the entire models landscape of intent.

Paid models have an incentive not to do that because if the market discovers it there is a huge economy penalty, but the free open source models don't have that disincentive.

Around 50% of that group says they plan to cancel their Claude subscriptions now that their local or open model setup is performing “good enough.”

Then you would go try it and be back using windows to game a week later.