AI IPO Fail for NVIDIA Backed Firmus - OpenAI is DEAD

Eli the Computer Guy (0:00)

Coming from CNBC, this might start to get a little bit interesting. Nvidia-backed Aussie AI firm, Firmus, withdraws historic IPO, citing market volatility.

So people like I, and Edzitron, and many, many other folks for the past couple of years have been screaming about the AI bubble, right? The AI bubble is coming, the AI bubble is coming, and the AI bubble is coming. And the problem is, is that the AI bubble has just been getting bigger and bigger and bigger and bigger. And so people say, look, look, Eli, Eli, you were talking about an AI bubble two years ago. I haven't seen a bubble burst. You've been talking about AI bubble a year ago. I haven't seen a bubble burst. Eli, stop crying, an AI bubble. But the important thing to understand with all of this is just at some point, it will burst. At some point, all economic cycles have to fail. Again, whether you have a bubble or not, you have, in the capitalist system, you have these economic cycles. And so I think we might actually be getting to the point where the bubble might start either deflating or it might start seeing the ripples on the bubble to show us that this entire damn thing might explode. One of the things I've been talking about with the whole AI stack is I actually like the AI stack. It's, I'm in this very weird position. Like, I piss everybody off, which is actually not a weird position for me. It's basically how it always is, where the people who love AI say I'm an AI hater, and the people that hate AI say I'm an AI propagandist, where in reality, I'm just in the middle. It's a fine stack.

It's a fine stack. It's a great technology. It's just not worth $2 trillion.

Get me talking about SQLite someday. SQLite, this relational database management system, awesome. It is the number one most used database system in the world. Absolutely fucking amazing piece of technology. And if I tried to argue that it should be worth $1 trillion, you'd call me a fucking idiot, and you'd be right. You would be okay. It would be okay to say that. But that's one of the things that I find funny, is if you look at all this technology around the world, there's all this amazing technology that does amazing things, that undergirds basically modern civilization. But if you said it should be worth $1 trillion, people would say you're an idiot. On the other hand, if you look at AI or these models, LLMs, and you have Anthropic coming out and trying to do a $2 trillion valuation, everybody's like, well, of course, of course, Anthropic should be worth $2 trillion, and SpaceX should be worth $2.3 trillion, and OpenAI should be worth $1.5 or $2 trillion. And the problem is that I keep just talking about this, it's just the numbers are too high.

The money and all this is just absolutely ridiculous. And the problem is, is at some point, at some point, the market will shift. And this is what always happens, right? So much of what happens in the markets, markets are based off of inertia.

So the market today will do better than yesterday because yesterday it was better than the day before, so it goes up. The problem you get to with markets is also with inertia, is things start going down, and they just have a tendency of going down. And so what's interesting here with this Aussie AI firm withdrawing from a historic IPO right now is we're starting to see the actual cracks in the stock market, right? So the Oreo ring, there's this ring, there's a smart ring out there. They were supposed to IPO.

Was it this month, last month? Anyways, recently, very recently, they were supposed to IPO, and they pulled out their IPO because the market looked bad. On top of that, it does appear that there were three other IPOs that actually backed out in other sectors of the market. On top of that, we see OpenAI, they're pushing their IPO in the 2027 Again, why are they pushing the market in the 2027? Because their books look bad? That's probably a big thing. Is it because of security? Probably fucking not. Is it because of where the market is? That's an interesting question. One of the curious things like with Anthropic right now, Michael Burry has put out this thesis for why Anthropic needs to IPO in November. And so basically, what he's been talking about is the whole token max idiocy. So there's this idea of token maxing in the beginning of the year. I thought it was an onion article originally. But token maxing was literally, bosses were telling their employees to burn as many tokens as possible. They're leaderboards, right? The more tokens you burn, the better you were doing as an employee. Fuck, it doesn't make a goddamn bit of sense as far as I'm concerned, but it was real. It was not onion. It was real. Anyways, so you had all the token maxing, you had a lot of that kind of stuff going on. And what we're seeing now is that the companies are pulling back, right? They're cutting budgets. They're doing a lot of stuff because they realize token maxing is an idiotic idea on the face of it. And they're also realizing the ROI for artificial intelligence simply isn't what they thought it was going to be. We are literally at a time period where the technology that was supposed to eliminate jobs is becoming more expensive than the employees it was supposed to eliminate, which is his own idiocy. And so one of the ideas with Anthropic having to IPO in November is the concept is, is all the revenue and everything up until that point in time will look really good, right? It'll be like, wow, this was a gangbuster year for revenue. That's why Anthropic should be worth $2 trillion. And the concern is, they IPO and basically their next quarter earnings and all that kind of stuff, then go the fuck off a cliff, which again will be an interesting thing for the stock market. Like IPOing at the height of your metrics and then watching all your numbers go off a cliff. I don't know. Just wondering how that's gonna work out. And so that's the interesting thing here. We're seeing a lot of the weird stuff going on in the stock market. It just seems like it precipitates the whole disaster of basically everything going boom. If we come down here, take a look at this. Australian AI data center operator Firmus, which is backed by Nvidia, has withdrawn his planned mega initial public offering, citing market volatility and conditions, the company said in an email statement to CNBC. Firmus said its board determined that the terms of the proposed offering did not adequately reflect the strength of its business and long-term growth outlook. But the board therefore concluded that proceeding with the offer was not in the best interests of the company and its shareholders, Firmus said in a statement, Firmus will now pursue capital from the private markets and consider alternative public and private market options, it added. And so that's the thing, like if you hear the narrative, if you hear the story that we've all been hearing for the past couple of years, shouldn't this, per the narrative, per the story, be about the best time to IPO? Right, we have been informed that AI is going to print money.