OpenAI's subscriptions are costing it a fortune, the latest at CES, and the agony of texting with men
Briefing Doc: AI, Funding, and Tech Trends Source: StrictlyVC Newsletter Main Themes: AI Development and Costs: OpenAI's ChatGPT pro plan is facing financial challenges, while Google is heavily investing in AI that simulates the physical world. Funding Landscape: The newsletter covers major funding rounds across various sectors, from biotech to construction tech, indicating a healthy but evolving investment landscape. Tech Market Trends: IPOs are anticipated to make a comeback, and the Chinese startup market is experiencing difficulties. X (formerly Twitter) is facing competition, and Elon Musk is facing criticism for his influence on European elections. Key Points: OpenAI's financial sustainability: Despite a $200/month price tag, ChatGPT's pro plan is not profitable, according to Sam Altman. This raises questions about the long-term viability of such subscription models for AI products. Google's ambitions in AI: Google is forming a new team focused on developing AI models that can simulate the physical world. This initiative, led by a former OpenAI lead, highlights Google's commitment to pushing the boundaries of AI capabilities. Funding trends: While large funding rounds are still happening (e.g., Orbis Medicines' $93.5 million Series A), smaller rounds are also prevalent, suggesting a potential shift in investor focus and a possible tightening of the funding environment. IPO market revival: Wall Street anticipates a comeback for IPOs, driven by private investors seeking to offload holdings. Klarna, a buy-now-pay-later company, is expected to be among the first to go public. Challenges in China: The Chinese startup market is facing significant difficulties, with VCs now pursuing the personal assets of entrepreneurs whose startups fail. This indicates a stark contrast to the previous boom period and highlights the risks associated with the Chinese market. Competition for X: Bluesky, a competitor to X, saw its user growth significantly slow down in December, suggesting that X, despite its controversies, still holds a strong position in the social media landscape. Musk's political influence: Elon Musk is facing criticism from French President Emmanuel Macron for directly intervening in European elections, raising concerns about the influence of tech leaders in politics. Quotes: OpenAI's financial situation: "OpenAI is losing money on ChatGPT's $200 per month pro plan, according to co-founder and CEO Sam Altman." Google's AI ambitions: “DeepMind has ambitious plans to make massive generative models that simulate the world,” Brooks wrote Monday morning. “I’m hiring for a new team with this mission.” Chinese VC actions: "In a sign of how far the Chinese startup market has fallen, Chinese VCs are now going after the personal assets of entrepreneurs whose startups go belly up." Overall: This newsletter provides a snapshot of current trends and developments in the tech and investment landscapes, highlighting both opportunities and challenges. The dominance of AI advancements, the evolving funding environment, and the growing influence of tech leaders are key areas to watch in 2025.