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Today in AI:

• OpenAI Selling $300 Million at $29 Billion Valuation

• Apple Launches AI Audiobooks

• Around the Horn

• Leo Sends His Regards

OpenAI Selling $300 Million at $29 Billion Valuation

Is- is the bull market back on?

OpenAI was at $14 billion in 2021. Just over a year later, there's a tender offer in the works at $29 billion. At this rate, it'll be worth *checks abacus* $257 billion in 2029.

Someone's about to make a whole lot of money. Most fundraising rounds you see issue new shares in exchange for the cash. Tender offers are when existing shareholders (employees, founders, previous investors) sell to the new investors.

The key question: is this hyped or justified?

On one hand, OpenAI projected $200 million revenue in 2023 and $1 billion in 2024. If that growth rate is real and sustains, a lot of valuations are possible.

On the other hand, it's not a sure bet that OpenAI is the one that builds value as AI changes the world.

Especially as research talent disperses into other orgs and companies like Stability AI rapidly develop open source versions of OpenAI's models and data.

This is a fundamental question for AI companies: where is the moat? Yes, AI will be valuable, but how are you valuable?

For more context on the question, I recommend Philip Clark's AI's eigenquestions. (Funnily enough, Philip is an investor at Thrive Capital, who is a buyer in the tender offer)

Apple Launches AI Audiobooks

*cue indie author fist pumping*

Audiobooks are popular, but expensive to make. They cleared a whopping $1.6 billion in US sales in 2021. But authors need to shell out some real $$$ to make one (e.g., $1,000-2,000 on the low end for a 5-hour book).

Apple is helping authors create AI-narrated audiobooks, and it's all on Apple's dime. Plus, the authors keep the rights.

How does it work? Authors apply with a book in the romance or certain fiction genres (literary, historical or women's fiction). It takes 1-2 months to make the audiobook and another 1-2 months to polish it.

The super picky genre selection is supposedly because they've specifically trained their text-to-speech for those genres.

Speaking of, we gave the voices a shot, and they're good, but not quite a full replacement. There's variation, but it's the same variation. You can see what we mean here.

A big win for authors, a strong move for Apple. By offering authors a free path to a new revenue stream, Apple's trying to build momentum in the ebook market, where it's dwarfed by Amazon (~10% vs. ~85%).

Around the Horn

• NYC public schools decide to ban ChatGPT. We have an upcoming interview with the CTO of a major public school system (not NYC). Stay tuned.

• Enterprise CIOs are still doubtful of AI, having been burned by too much hype before.

• Meanwhile, small business tools could be a strong entry point for B2B AI tools. Waymark is focusing on small business TV advertising.

• Stable Diffusion model that makes fake Japanese Kanji characters.

• Also: did you know there are these many specialized Stable Diffusion models?

• For the curious reader who likes longer reads: The Physics Principle That Inspired Modern AI Art

Leo Sends His Regards

That's all we have for today. See you cool cats on Twitter if you're there: @nonmayorpete