The Genius Method That Made OpenAI The Hottest Startup in Tech
The hottest startup in Silicon Valley today is OpenAI, the Microsoft-backed developer of ChatGPT, a much-hyped chatbot that could write a poem, university essay, and even a line of software code.
Tesla tycoon Elon Musk was an early investor in OpenAI. Microsoft, reportedly, provided approximately a first investment of $1 billion to $10 billion in an goal to challenge Google’s world-dominating search engine.
If agreed, the money injection by the Windows maker should value OpenAI at a impressive $29 billion, making it a rare tech-world success when big players like Amazon, Meta, and Twitter are reducing costs and laying off staff.
According to Dan Ives, analyst of Wedbush Securities, Microsoft is clearly being aggressive on this front and not going to be left behind on what can be a potential game-changing AI investment.
Before the launch of ChatGPT, OpenAI had amazed tech geeks with Dall-E 2, software that produces digital images with simple instructions.
Microsoft, that makes no secret of its AI ambitions, has integrated Dall-E 2 into numerous of its applications. Currently, according to a report in Bloomberg, the tech giant wishes to graft ChatGPT to its Bing search engine to take on Google.
Since ChatGPT was introduced in November, this chatbot’s prowess has aroused internet users’ curiosity and fascination.
It can formulate detailed and human-like answers on a wide variety of subjects in a few seconds, raising fears that it is vulnerable to misuse by school cheats or for disinformation.
‘ Not inexpensive’
The dizzying success is in part because of OpenAI’s smart marketing strategy in, which it made its research accessible to non-experts, said AI expert Robb Wilson, creator of OneReach.ai, a software company.
According to Wilson, having this tech available to technologists was one thing. Presenting it in a chat user interface and enabling non-developers to begin playing with it ignited a conversation.
Founded in late 2015, OpenAI is conducted by Sam Altman, a 37-year-old entrepreneur and also the former president of startup incubator Y Combinator.
The company has counted on the economic support of distinguished contributors from the start, including LinkedIn co-founder Reid Hoffman, investor Peter Thiel, and Musk.
The multi-billionaire served on OpenAI’s board until 2018; however left to focus on Tesla, the electric automobile company.
The startup also relies on a group of computer researchers and scientists led by Ilya Sutskever, a former Google executive that specializes in machine learning.
OpenAI, which didn’t respond to AFP’s inquiries, had around 200 employees by 2021, according to a query made directly on ChatGPT.
Meanwhile, despite the excitement generated by ChatGPT, the company has yet to discover a path to financial independence.
Founded as a nonprofit, the startup turned into a “capped for-profit” company in 2019 to draw more investors. This week, co-founder Greg Brockman stated that a paid variation of ChatGPT was in the works.
The quest for funding seems necessary for a company with outrageous expenses.
In a Twitter exchange with Musk in early December, Altman acknowledged that each discussion on ChatGPT costs OpenAI many US cents.
Accordingly to estimates by Tom Goldstein, an associate professor in the University of Maryland’s computer science division, the company is shelling out $100,000 a day for its bot or regarding $3 million a month.
Partnering with Microsoft, which offers the startup with its remote computing services, might cut costs; however, “either way, it’s not cheap,” Goldstein stated.
“Some state it’s wasteful to pour these kinds of resources … into a demo,” he included.
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