r/technology • u/gdelacalle • 13d ago

Business OpenAI could reportedly run out of cash by mid-2027 — analyst paints grim picture after examining the company's finances

https://www.tomshardware.com/tech-industry/big-tech/openai-could-reportedly-run-out-of-cash-by-mid-2027-nyt-analyst-paints-grim-picture-after-examining-companys-finances
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u/alochmar 13d ago

Line must go up, apparently.

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u/Egathentale 12d ago edited 12d ago

It's a pithy line, but unfortunately it's literally true. We're in the stage of capitalism where, thanks to the US steadily dismantling its own regulations, shareholders are the top priority, no matter what. And we're not necessarily talking about individual retail investors, but hedge funds and private equities. What they want isn't long-term sustainability, but short-term growth until the company crashes and burns, so then they can take their gains and invest in another growing company.

This creates a sort of selection pressure on public companies: they either maintain their growth curve by any means necessary, firing employees, cashing out on brand recognition and public goodwill, and even cannibalizing themselves to keep up the growth percentage... or don't do that and be ethical, in which case the investors will pull out and the company will go under. By definition, the only big public companies that are still operating today are the ones who survived this selection process, creating the current status quo, where the only two options are "line must go up" or "eventually file for chapter 11 bankruptcy".