There's a classic scene in The Wolf of Wall Street where Jordan Belfort, completely wasted, tries to explain to the audience how he makes money. The crowd cheers. Nobody understood a damn thing. But everybody wants in.
That's pretty much what's happening with OpenAI right now.
The Number That'll Make Anyone Choke
OpenAI — yes, the ChatGPT company, the one Sam Altman swore would be a "nonprofit organization" — just raised $110 billion. One hundred and ten billion dollars. For context: Paraguay's entire GDP is smaller than that.
And the goal? To haul ass toward an IPO.
Let me translate from corporate-speak to plain English: OpenAI wants to go public on the stock market. They want you, me, and your grandma's pension fund to be able to buy their shares. And before pulling that off, they're filling up the tank with institutional investor money from people betting this company will take over the world.
The "Winner Takes All" Circus
Look, I'm not anti-tech. I'm no Luddite. I use AI every single day. But let's separate the wheat from the chaff here.
What OpenAI is doing is a classic Silicon Valley play: grow at all costs, burn cash like there's no tomorrow, and pray the market keeps buying the narrative before the bill comes due.
Remember WeWork? Remember Theranos? Remember all those companies that raised absurd rounds, got valued at galaxies of dollars, and then... poof?
"Oh, but OpenAI is different — they have a real product."
Fair enough. They do have a real product. ChatGPT is impressive. But a real product doesn't mean a sustainable business model. Amazon took nearly a decade to turn a profit. And Amazon was selling boxes. OpenAI is trying to monetize something nobody really knows how to price — generative artificial intelligence — in a market that shifts every 6 months.
The Skin in the Game Nobody's Asking About
Nassim Taleb has a simple rule: never trust someone who doesn't have their own skin in the game.
So here's my question: who are the investors putting up this $110 billion? Sovereign wealth funds, elite venture capital, giants like Microsoft and SoftBank (yes, the same SoftBank that bet on WeWork). It's OPM money — Other People's Money. Somebody else's cash.
If it all goes south, Masayoshi Son isn't going to miss any meals. Abu Dhabi's sovereign fund isn't going to cancel their Netflix subscription. The ones who'll get screwed are the retail investors who buy at the IPO thinking they're snagging "the next Apple."
The conversion from "nonprofit" to a very-much-for-profit company should've set off a red flag the size of a stadium floodlight. Sam Altman pulled off that transition with the subtlety of a runaway freight truck. And the market gave him a standing ovation.
What This Means for Your Wallet
If you invest in tech, you need to understand this: the AI race is creating an unprecedented concentration of capital. Nvidia, Microsoft, Google, Meta — they're all pouring hundreds of billions into this infrastructure. If AI delivers on its promises, great. If it doesn't deliver at the expected speed, a lot of investors are going to be holding very expensive paper.
An OpenAI IPO could be the defining event of this era. Or it could be the bell ringing at the top of the market — like AOL buying Time Warner in 2000.
Financial history doesn't repeat itself, but it rhymes. And this rhyme is sounding dangerously familiar.
The Question That Actually Matters
Warren Buffett likes to say that only when the tide goes out do you discover who's been swimming naked.
The AI tide is high. Sky-high. Everybody looks like a genius. Every fund is in the green. Every Instagram guru is selling you a course on "how to invest in AI."
But let me ask you something: when the OpenAI IPO drops and everyone's euphoric, are you going to be the guy who buys at the top because "everyone else is buying"? Or are you going to be the guy who remembers that $110 billion raised before turning a consistent profit is a sign that somebody really needs your money?
Think about that before you hit the buy button.
