The year was 2006.
I stood on the subway heading to my hedge fund’s offices, scrolling through emails on my Blackberry.
My fingers were attacking the built-in QWERTY keyboard responding to a message from my analyst on the fly.
Back then, my BlackBerry was indispensable. It was life-changing.
I could work from anywhere with a mobile connection, and it kept me updated on the global markets around-the-clock.
The BlackBerry was an innovative device, and everyone on Wall Street had one. There were more traders on Blackberrys than reading The Wall Street Journal on the subways.
However, if you had told me that this device would become obsolete just a few years later, I would have said it was more likely for a meteor to hit NYC.
Technological history reminds us that frontrunners often fail.
The disruptors often become the disrupted.
Have you heard of MySpace?
Or have you searched anything on Infoseek or Yahoo lately?
Snapped a shot with a Polaroid camera?
When it comes to the race for the heart and soul of artificial intelligence, it looks like the frontrunner could soon be trailing.
AI Showdown: Musk vs. Altman
In early 2023, we alerted Banyan Edge readers to the decade’s biggest technological disruption when OpenAI released ChatGPT.
Prompting ChatGPT to compose a Bob Dylan song about today’s weather or to write a Shakespearean sonnet about my favorite stocks felt like magic. It reminded me of the first time I did an internet search in the mid-90s or when I drove an electric car in 2010.
I knew it was going to be huge.
And it was. A few months later, ChatGPT reached 100 million users.
It became the fastest growing application of all time.
ChatGPT is the most recognizable name in AI, but it wasn’t an overnight success.
The company was founded as a not-for-profit 501(c)(3) in December 2015 by Sam Altman and some big names in tech. The goal was to develop advanced AI, known as artificial general intelligence (AGI), in a way that’s safe and benefits humanity.
Elon Musk himself donated close to $50 million.
But lately, OpenAI has gone in a different direction.
Late last year, the board temporarily ousted Sam Altman, after he kept them out of the loop about ChatGPT’s release. He returned five days later.
That was when the internal turmoil began. This year, the company lost a number of top executives, including Chief Technology Officer Mira Murati.
Notwithstanding, the company recently raised $6 billion at a $157 billion valuation. That makes it among the highest valued private companies in the world.
As part of a restructuring to a for-profit company, CEO Sam Altman was given a 7% equity stake, worth around $10 billion.
They’ve also asked investors not to back any rival AI start-ups such as Elon Musk’s xAI.
I’m sure this will further infuriate Musk. He’s already sued OpenAI twice, saying that the firm puts profits and commercial interests ahead of the public good.
Musk is still upset that he invested $50 million to help start OpenAI and has seen nothing in return.
This is likely a key motivation behind his launch of xAI, Elon’s AI startup that brings AI technology to more than 500 users of the X (formerly Twitter) app.
In May, xAI secured $6 billion in funding from high-profile investors, including Andreessen Horowitz, Lightspeed Venture Partners and Sequoia Capital.
This capital raise valued the company at $24 billion. Investors in Elon’s social media app X own 25 percent of xAI, which benefits from the billions of tweets the social media platform produces every day.
Last week, Elon took the race to another level.
After moving xAI into OpenAI’s former San Francisco headquarters, he hosted a recruiting event the same day that OpenAI was throwing its annual developers’ day across town. This seemed like an intentional shot at his former OpenAI co-founder.
As if Elon didn’t already have enough on his plate, he’s also hosting a massive Robotaxi event on October 10.
He’s hinted the “We, Robot” event will feature more than just Robotaxis.
Perhaps we’ll hear more about xAI’s plans to make OpenAI the modern version of the Blackberry?
And if you want to see what companies to invest in before the Tesla Robotaxi Event on Thursday, October 10, click here.
Until next time,
Ian King
Editor, Strategic Fortunes
