1 00:00:01,760 --> 00:00:05,120 Hey everybody, welcome back to the Elon Musk Podcast. 2 00:00:05,200 --> 00:00:08,360 This is a show where we discuss. The critical crossroads. 3 00:00:08,360 --> 00:00:13,360 That shape SpaceX, Tesla X, The Boring Company and Neurolink. 4 00:00:13,680 --> 00:00:18,960 I'm your host, Will Walden. Open AI now carries a higher 5 00:00:18,960 --> 00:00:22,120 valuation in secondary markets than SpaceX. 6 00:00:22,480 --> 00:00:25,000 That shift forces the question upon us all. 7 00:00:25,240 --> 00:00:28,360 Why are investors putting more weight on a chatbot company than 8 00:00:28,360 --> 00:00:31,440 the most successful private space company in history? 9 00:00:31,760 --> 00:00:34,560 Are they taking down Elon? Employees selling their shares 10 00:00:34,560 --> 00:00:37,360 and Open AI have priced the company at more than $90 11 00:00:37,520 --> 00:00:42,800 billion. Actual buyers are willing to pay 12 00:00:42,800 --> 00:00:45,520 this. That puts Open AI paper worth 13 00:00:45,560 --> 00:00:49,160 above SpaceX, which has recently been trading closer to 80 14 00:00:49,160 --> 00:00:52,640 billion, down from a peak of 150 billion ish now. 15 00:00:52,640 --> 00:00:55,120 The difference comes from how each company makes money. 16 00:00:55,560 --> 00:00:58,720 SpaceX earns revenue through launches and Starlink 17 00:00:58,720 --> 00:01:02,920 subscriptions, and both demand huge amounts of capital and long 18 00:01:02,920 --> 00:01:06,240 project timelines. Open AI generates cash by 19 00:01:06,240 --> 00:01:10,640 running software at scale. Jet, GBT plus subscriptions, 20 00:01:10,640 --> 00:01:14,760 enterprise integrations and it's API business are high margin 21 00:01:14,760 --> 00:01:18,880 streams that turn models into recurring revenue on a second to 22 00:01:18,880 --> 00:01:21,640 second basis. The opening eye expects more 23 00:01:21,640 --> 00:01:24,560 than a billion dollars in annual revenue, a number that seemed 24 00:01:24,640 --> 00:01:28,720 unrealistic just two years ago. Now, that growth fuels investor 25 00:01:28,720 --> 00:01:31,920 belief that the company can keep compounding revenue without 26 00:01:31,920 --> 00:01:34,000 needing the kind of infrastructure build out this 27 00:01:34,000 --> 00:01:37,320 space launches require. The speed of adoption also 28 00:01:37,320 --> 00:01:39,360 matters. ChatGPT became one of the 29 00:01:39,360 --> 00:01:42,600 fastest apps to reach 100 million users, creating cultural 30 00:01:42,600 --> 00:01:45,480 pull that SpaceX has just never had. 31 00:01:45,920 --> 00:01:49,320 SpaceX has installed, though it's continuing to dominate the 32 00:01:49,320 --> 00:01:52,800 launch market and expand Starlink into global broadband 33 00:01:52,800 --> 00:01:55,280 coverage. Evaluation depends on where 34 00:01:55,280 --> 00:01:57,440 investors see the strongest future gains. 35 00:01:57,800 --> 00:02:02,120 Right now, AI is the future. Rockets deliver contracts 36 00:02:02,120 --> 00:02:07,760 though, and AI and software delivers those growth curves up 37 00:02:07,800 --> 00:02:11,120 and to the right. I want to make a quick statement 38 00:02:11,120 --> 00:02:13,760 here. I've been sick for a little 39 00:02:13,760 --> 00:02:17,040 while now, last two ish weeks, 2-3 weeks. 40 00:02:17,520 --> 00:02:19,880 So I apologize if my shows haven't been up to date. 41 00:02:20,280 --> 00:02:22,440 So when he reached out to me, somebody meant to comment and 42 00:02:22,440 --> 00:02:26,840 they said, you know, hey, we're I wanted the newest news and I'm 43 00:02:26,840 --> 00:02:30,320 thinking like I can't even talk. How am I supposed to do this? 44 00:02:30,800 --> 00:02:34,480 I have about 1000 episodes and through those episodes I've only 45 00:02:34,480 --> 00:02:38,240 been sick a few times. I've been doing this for six or 46 00:02:38,240 --> 00:02:43,320 seven years now and during that whole time I rarely went back 47 00:02:43,320 --> 00:02:48,640 into the archives to put something out just because one 48 00:02:48,640 --> 00:02:50,600 thing or another happens. Life happens. 49 00:02:50,600 --> 00:02:55,640 So I do apologize for that and I hope you will continue to listen 50 00:02:55,640 --> 00:02:57,720 to the show. Now, if you're a long time 51 00:02:57,800 --> 00:03:00,920 subscriber or follower of the show, I really do appreciate 52 00:03:00,920 --> 00:03:04,840 you, but I need your help. If you like the show and you 53 00:03:04,840 --> 00:03:08,160 like what I do with it, please take a second and give us a five 54 00:03:08,160 --> 00:03:10,480 star rating on whatever podcast app you're on right now. 55 00:03:11,280 --> 00:03:12,480 You don't know how much this helps. 56 00:03:12,920 --> 00:03:15,600 If you want me to keep doing this show, please do that. 57 00:03:15,600 --> 00:03:21,120 If we can get 25 star reviews in the next few days, that would 58 00:03:21,120 --> 00:03:28,960 Jack us right to some crazy amount of of spread, spread of 59 00:03:28,960 --> 00:03:30,520 the knowledge that we have of Elon. 60 00:03:31,040 --> 00:03:33,360 And we're going to continue doing this for a very long time. 61 00:03:33,600 --> 00:03:36,320 Been doing it for seven years now. 62 00:03:36,720 --> 00:03:39,080 I'm not going to stop. So I need your help though. 63 00:03:39,360 --> 00:03:41,800 Five star review, please. I appreciate you. 64 00:03:42,600 --> 00:03:45,400 Now let's get back into some Elon news because open AI is, 65 00:03:45,880 --> 00:03:47,600 you know, they're coming after him. 66 00:03:48,360 --> 00:03:51,840 We know how Elon and Open AI don't really get along either. 67 00:03:52,480 --> 00:03:56,280 So the Microsoft partnership further pushes Open AI's edge 68 00:03:56,680 --> 00:04:00,600 and by embedding opening eyes models into Windows often and at 69 00:04:00,600 --> 00:04:04,480 Office and Azure, Microsoft has given its distribution that no 70 00:04:04,480 --> 00:04:07,160 competitor can even match. It's on every desktop computer 71 00:04:07,160 --> 00:04:09,880 basically. SpaceX doesn't have that kind of 72 00:04:09,880 --> 00:04:13,120 consumer facing pipeline. They work with NASA and private 73 00:04:13,120 --> 00:04:17,000 companies that launch satellites and people too. 74 00:04:17,200 --> 00:04:20,839 It's contracts with NASA and the Pentagon secure cash flow, but 75 00:04:21,120 --> 00:04:23,960 they don't create mass market lock in the way the ChatGPT 76 00:04:23,960 --> 00:04:25,880 does. Like I said before, ChatGPT 77 00:04:26,920 --> 00:04:29,720 people sign up every second. People don't launch rockets 78 00:04:29,720 --> 00:04:32,240 every second and they don't get contracts every second. 79 00:04:32,480 --> 00:04:35,440 They do get big contracts of SpaceX for millions or billions 80 00:04:35,440 --> 00:04:40,560 of dollars, but nothing like open AI and chap TPT which can 81 00:04:40,560 --> 00:04:45,880 get that money much faster and up and to the right. 82 00:04:46,680 --> 00:04:49,680 Unlike SpaceX, which has to wait for wait for these contracts and 83 00:04:49,680 --> 00:04:53,600 fight for these contracts now. Elon Musk's connection adds 84 00:04:53,600 --> 00:04:56,680 another layer of irony here. He Co founded Open AI before 85 00:04:56,680 --> 00:04:59,520 leaving in 2018 after a dispute over its direction. 86 00:05:00,160 --> 00:05:03,120 Now the company that he helped launch has eclipse SpaceX and 87 00:05:03,120 --> 00:05:05,400 valuation. His response has been to build 88 00:05:05,520 --> 00:05:08,200 XAI in its crock chatbot inside of X. 89 00:05:08,800 --> 00:05:12,120 But that product is far behind Open AI in market traction. 90 00:05:12,600 --> 00:05:15,320 The way investors allocate capital shows a broader shift to 91 00:05:15,600 --> 00:05:18,640 space infrastructure is long term intangible. 92 00:05:18,640 --> 00:05:22,040 It's things you can actually go up and touch a rocket. 93 00:05:22,600 --> 00:05:25,160 AI software is immediate and it's scalable. 94 00:05:25,160 --> 00:05:28,240 You build more data centers. Investors prefer businesses that 95 00:05:28,240 --> 00:05:30,280 can grow without hardware bottlenecks. 96 00:05:30,600 --> 00:05:34,920 Spacex's Starship, it takes years for them to get a Starship 97 00:05:34,920 --> 00:05:38,800 off the ground while used to. And now they do it every 3-4 98 00:05:38,800 --> 00:05:42,160 months and hopefully they want to do it every few days. 99 00:05:42,600 --> 00:05:47,520 But right now it's a hardware bottleneck, and Open AI shares 100 00:05:48,520 --> 00:05:51,360 now command more than those of SpaceX in private markets 101 00:05:51,360 --> 00:05:53,920 because of this. The comparison also shows how 102 00:05:53,920 --> 00:05:57,520 narratives shape this value. SpaceX put satellites in orbit 103 00:05:57,920 --> 00:06:01,120 and lands rockets vertically, but it operates largely behind 104 00:06:01,120 --> 00:06:04,200 the scenes in secrecy. Except for when you're on Hwy. 4 105 00:06:04,680 --> 00:06:07,720 and you can watch Starship being built at Starbase. 106 00:06:08,000 --> 00:06:11,200 Open the eye through ChatGPT has become part of daily life for 107 00:06:11,200 --> 00:06:13,960 students, developers, enterprises, business people. 108 00:06:13,960 --> 00:06:17,440 Everybody uses ChatGPT. If you don't use ChatGPT, you're 109 00:06:17,440 --> 00:06:19,800 one of the few. Now that visibility translate 110 00:06:19,800 --> 00:06:23,240 into more demand for its shares too, and also more money for 111 00:06:23,240 --> 00:06:26,160 open AI. SpaceX is still one of the most 112 00:06:26,200 --> 00:06:27,760 important private companies in the world. 113 00:06:28,200 --> 00:06:31,840 They're going to fly us to Mars. That's going to be the most 114 00:06:31,840 --> 00:06:34,200 important feat in all of human history. 115 00:06:34,680 --> 00:06:36,840 Open AI will just be a chat bot at that point. 116 00:06:37,400 --> 00:06:39,920 Open the Eye has reached a point where it's influence, revenue 117 00:06:39,920 --> 00:06:43,400 growth and investor appetite have given it the crown as the 118 00:06:43,400 --> 00:06:46,320 most valuable US startup. What do you think Elon thinks 119 00:06:46,320 --> 00:06:48,360 about this? Let me know in the comments. 120 00:06:48,840 --> 00:06:53,640 Now. 2025 software built to protect the predict the next 121 00:06:53,640 --> 00:06:58,680 word is worth more to investors than rockets that will 122 00:06:58,680 --> 00:07:04,840 potentially lead humanity to a habitat on another planet. 123 00:07:06,640 --> 00:07:09,400 Think about that for a moment. What's more important to you? 124 00:07:09,400 --> 00:07:10,800 What's more important to humanity? 125 00:07:11,000 --> 00:07:16,400 A chat bot, open AI with AGI or landing people on Mars? 126 00:07:17,560 --> 00:07:20,400 Let me know in the comments. Thanks for listening everybody. 127 00:07:20,400 --> 00:07:22,880 Like I said before, I'm a little bit, as you can tell, a little 128 00:07:22,880 --> 00:07:29,080 stuffy and have had a horrific 3 weeks of sickness so I 129 00:07:29,080 --> 00:07:32,800 appreciate you sticking around and it will get better from now 130 00:07:32,800 --> 00:07:34,560 on. Take care, everybody. 131 00:07:34,960 --> 00:07:36,680 Hey, thank you so much for listening today. 132 00:07:36,680 --> 00:07:38,720 I really do appreciate your support. 133 00:07:38,720 --> 00:07:41,520 If you could take a second and hit this subscribe or the follow 134 00:07:41,520 --> 00:07:43,720 button on whatever podcast platform that you're listening 135 00:07:43,720 --> 00:07:46,400 on right now, I greatly appreciate it. 136 00:07:46,400 --> 00:07:49,080 It helps out the show tremendously and you'll never 137 00:07:49,080 --> 00:07:52,040 miss an episode. And each episode is about 10 138 00:07:52,040 --> 00:07:54,640 minutes or less to get you caught up quickly. 139 00:07:55,040 --> 00:07:57,800 And please, if you want to support the show even more, go 140 00:07:57,800 --> 00:08:03,440 to patreon.com/stagezero and please take care of yourselves 141 00:08:03,440 --> 00:08:05,360 and each other and I'll see you tomorrow.