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OpenAI Surpasses SpaceX in Valuation · Elon Musk Podcast

• 0:01
  Hey everybody, welcome back to the Elon Musk Podcast.
• 0:05
  This is a show where we discuss. The critical crossroads.
• 0:08
  That shape SpaceX, Tesla X, The Boring Company and Neurolink.
• 0:13
  I'm your host, Will Walden. Open AI now carries a higher
• 0:18
  valuation in secondary markets than SpaceX.
• 0:22
  That shift forces the question upon us all.
• 0:25
  Why are investors putting more weight on a chatbot company than
• 0:28
  the most successful private space company in history?
• 0:31
  Are they taking down Elon? Employees selling their shares
• 0:34
  and Open AI have priced the company at more than $90
• 0:37
  billion. Actual buyers are willing to pay
• 0:42
  this. That puts Open AI paper worth
• 0:45
  above SpaceX, which has recently been trading closer to 80
• 0:49
  billion, down from a peak of 150 billion ish now.
• 0:52
  The difference comes from how each company makes money.
• 0:55
  SpaceX earns revenue through launches and Starlink
• 0:58
  subscriptions, and both demand huge amounts of capital and long
• 1:02
  project timelines. Open AI generates cash by
• 1:06
  running software at scale. Jet, GBT plus subscriptions,
• 1:10
  enterprise integrations and it's API business are high margin
• 1:14
  streams that turn models into recurring revenue on a second to
• 1:18
  second basis. The opening eye expects more
• 1:21
  than a billion dollars in annual revenue, a number that seemed
• 1:24
  unrealistic just two years ago. Now, that growth fuels investor
• 1:28
  belief that the company can keep compounding revenue without
• 1:31
  needing the kind of infrastructure build out this
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  space launches require. The speed of adoption also
• 1:37
  matters. ChatGPT became one of the
• 1:39
  fastest apps to reach 100 million users, creating cultural
• 1:42
  pull that SpaceX has just never had.
• 1:45
  SpaceX has installed, though it's continuing to dominate the
• 1:49
  launch market and expand Starlink into global broadband
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  coverage. Evaluation depends on where
• 1:55
  investors see the strongest future gains.
• 1:57
  Right now, AI is the future. Rockets deliver contracts
• 2:02
  though, and AI and software delivers those growth curves up
• 2:07
  and to the right. I want to make a quick statement
• 2:11
  here. I've been sick for a little
• 2:13
  while now, last two ish weeks, 2-3 weeks.
• 2:17
  So I apologize if my shows haven't been up to date.
• 2:20
  So when he reached out to me, somebody meant to comment and
• 2:22
  they said, you know, hey, we're I wanted the newest news and I'm
• 2:26
  thinking like I can't even talk. How am I supposed to do this?
• 2:30
  I have about 1000 episodes and through those episodes I've only
• 2:34
  been sick a few times. I've been doing this for six or
• 2:38
  seven years now and during that whole time I rarely went back
• 2:43
  into the archives to put something out just because one
• 2:48
  thing or another happens. Life happens.
• 2:50
  So I do apologize for that and I hope you will continue to listen
• 2:55
  to the show. Now, if you're a long time
• 2:57
  subscriber or follower of the show, I really do appreciate
• 3:00
  you, but I need your help. If you like the show and you
• 3:04
  like what I do with it, please take a second and give us a five
• 3:08
  star rating on whatever podcast app you're on right now.
• 3:11
  You don't know how much this helps.
• 3:12
  If you want me to keep doing this show, please do that.
• 3:15
  If we can get 25 star reviews in the next few days, that would
• 3:21
  Jack us right to some crazy amount of of spread, spread of
• 3:28
  the knowledge that we have of Elon.
• 3:31
  And we're going to continue doing this for a very long time.
• 3:33
  Been doing it for seven years now.
• 3:36
  I'm not going to stop. So I need your help though.
• 3:39
  Five star review, please. I appreciate you.
• 3:42
  Now let's get back into some Elon news because open AI is,
• 3:45
  you know, they're coming after him.
• 3:48
  We know how Elon and Open AI don't really get along either.
• 3:52
  So the Microsoft partnership further pushes Open AI's edge
• 3:56
  and by embedding opening eyes models into Windows often and at
• 4:00
  Office and Azure, Microsoft has given its distribution that no
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  competitor can even match. It's on every desktop computer
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  basically. SpaceX doesn't have that kind of
• 4:09
  consumer facing pipeline. They work with NASA and private
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  companies that launch satellites and people too.
• 4:17
  It's contracts with NASA and the Pentagon secure cash flow, but
• 4:21
  they don't create mass market lock in the way the ChatGPT
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  does. Like I said before, ChatGPT
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  people sign up every second. People don't launch rockets
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  every second and they don't get contracts every second.
• 4:32
  They do get big contracts of SpaceX for millions or billions
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  of dollars, but nothing like open AI and chap TPT which can
• 4:40
  get that money much faster and up and to the right.
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  Unlike SpaceX, which has to wait for wait for these contracts and
• 4:49
  fight for these contracts now. Elon Musk's connection adds
• 4:53
  another layer of irony here. He Co founded Open AI before
• 4:56
  leaving in 2018 after a dispute over its direction.
• 5:00
  Now the company that he helped launch has eclipse SpaceX and
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  valuation. His response has been to build
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  XAI in its crock chatbot inside of X.
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  But that product is far behind Open AI in market traction.
• 5:12
  The way investors allocate capital shows a broader shift to
• 5:15
  space infrastructure is long term intangible.
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  It's things you can actually go up and touch a rocket.
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  AI software is immediate and it's scalable.
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  You build more data centers. Investors prefer businesses that
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  can grow without hardware bottlenecks.
• 5:30
  Spacex's Starship, it takes years for them to get a Starship
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  off the ground while used to. And now they do it every 3-4
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  months and hopefully they want to do it every few days.
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  But right now it's a hardware bottleneck, and Open AI shares
• 5:48
  now command more than those of SpaceX in private markets
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  because of this. The comparison also shows how
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  narratives shape this value. SpaceX put satellites in orbit
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  and lands rockets vertically, but it operates largely behind
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  the scenes in secrecy. Except for when you're on Hwy. 4
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  and you can watch Starship being built at Starbase.
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  Open the eye through ChatGPT has become part of daily life for
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  students, developers, enterprises, business people.
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  Everybody uses ChatGPT. If you don't use ChatGPT, you're
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  one of the few. Now that visibility translate
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  into more demand for its shares too, and also more money for
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  open AI. SpaceX is still one of the most
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  important private companies in the world.
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  They're going to fly us to Mars. That's going to be the most
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  important feat in all of human history.
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  Open AI will just be a chat bot at that point.
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  Open the Eye has reached a point where it's influence, revenue
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  growth and investor appetite have given it the crown as the
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  most valuable US startup. What do you think Elon thinks
• 6:46
  about this? Let me know in the comments.
• 6:48
  Now. 2025 software built to protect the predict the next
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  word is worth more to investors than rockets that will
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  potentially lead humanity to a habitat on another planet.
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  Think about that for a moment. What's more important to you?
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  What's more important to humanity?
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  A chat bot, open AI with AGI or landing people on Mars?
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  Let me know in the comments. Thanks for listening everybody.
• 7:20
  Like I said before, I'm a little bit, as you can tell, a little
• 7:22
  stuffy and have had a horrific 3 weeks of sickness so I
• 7:29
  appreciate you sticking around and it will get better from now
• 7:32
  on. Take care, everybody.
• 7:34
  Hey, thank you so much for listening today.
• 7:36
  I really do appreciate your support.
• 7:38
  If you could take a second and hit this subscribe or the follow
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• 7:43
  on right now, I greatly appreciate it.
• 7:46
  It helps out the show tremendously and you'll never
• 7:49
  miss an episode. And each episode is about 10
• 7:52
  minutes or less to get you caught up quickly.
• 7:55
  And please, if you want to support the show even more, go
• 7:57
  to patreon.com/stagezero and please take care of yourselves
• 8:03
  and each other and I'll see you tomorrow.