OpenAI just launched a $10 billion company whose SOLE mission is to \u201cpush\u201d businesses to adopt AI. And they\u2019re literally guaranteeing investors a 17.5% annualized return to do it. It\u2019s called \u201cThe Deployment Company.\u201d OpenAI finalized it yesterday with 19 investors, including TPG, SoftBank, Bain Capital, Brookfield, and Advent International. <\/p>\n\n\n\n
Here\u2019s the structure: OpenAI is putting in $1.5 billion. Private equity funds are putting in $4 billion. In return, these funds are opening up their 2,000+ portfolio companies with relevant customer bases for OpenAI\u2019s products. OpenAI then deploys entire teams of engineers directly inside these companies\u2014similar to Palantir\u2014to integrate its tools into day-to-day operations. <\/p>\n\n\n\n
And here\u2019s the big red flag in the whole story: OpenAI is guaranteeing these funds a 17.5% annualized return for five years. This means that even if the companies in the portfolio don\u2019t want the AI, don\u2019t need it, or don\u2019t get any value from it, OpenAI still has to pay them. Think about what that means for a second: OpenAI is so desperate for corporate adoption that it\u2019s paying Wall Street to \u201cpush\u201d its product into thousands of businesses.<\/strong> They\u2019ve turned private equity funds into a distribution cartel with a guaranteed commission. <\/p>\n\n\n\n This has never happened before in enterprise software. No software company in history has guaranteed above-market returns to financial backers just to install their product. And it gets even crazier: Just minutes after OpenAI\u2019s announcement, Anthropic announced its own version. A $1.5 billion joint venture with Blackstone, Goldman Sachs, and Hellman & Friedman. <\/p>\n\n\n\n Same scenario. Two companies with a combined private valuation of over $1 TRILLION have come to the same conclusion on the same day: organic demand for their products isn\u2019t growing fast enough. If enterprises were lining up to buy AI themselves, they wouldn\u2019t have to \u201cbribe\u201d private equity funds with guaranteed returns to \u201cstuff\u201d it into their portfolios. They would just sell it normally\u2014like every other software company in history. But they can\u2019t. Because the gap between what AI companies promise and what enterprises actually experience is still huge. OpenAI\u2019s COO, Brad Lightcup, just took on a new role specifically to lead this \u201cpush.\u201d They\u2019ve also signed \u201cFrontier Alliances\u201d with major consulting firms to deploy AI through professional services. <\/p>\n\n\n\n Every move they make screams the same thing: We have a demand problem. And all of this is happening right before OpenAI tries to go public for $850 billion. If they can show Wall Street that 2,000+ companies \u201cuse OpenAI products\u201d through this PE channel, they\u2019ll be inflating their corporate metrics right before the IPO. It doesn\u2019t matter if the companies really need it or if it creates real value. All that matters is the number on the S-1. <\/p>\n\n\n\n This is the AI \u200b\u200bplaybook entering its most dangerous phase. The technology is real, but the business model is driven by financial tricks, guaranteed returns, and distribution deals that look more like a pharmaceutical company paying doctors to prescribe its medicine<\/strong> than a software company winning quality customers. <\/p>\n\n\n\n Both OpenAI and Anthropic admitted it.<\/p>\n","protected":false},"excerpt":{"rendered":" OpenAI just launched a $10 billion company whose SOLE mission is to \u201cpush\u201d businesses to adopt AI. And they\u2019re literally guaranteeing investors a 17.5% annualized return to do it. It\u2019s called \u201cThe Deployment Company.\u201d OpenAI finalized it yesterday with 19 investors, including TPG, SoftBank, Bain Capital, Brookfield, and Advent International. Here\u2019s the structure: OpenAI is […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-53","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/marstomato.com\/index.php?rest_route=\/wp\/v2\/posts\/53","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/marstomato.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/marstomato.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/marstomato.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/marstomato.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=53"}],"version-history":[{"count":1,"href":"https:\/\/marstomato.com\/index.php?rest_route=\/wp\/v2\/posts\/53\/revisions"}],"predecessor-version":[{"id":54,"href":"https:\/\/marstomato.com\/index.php?rest_route=\/wp\/v2\/posts\/53\/revisions\/54"}],"wp:attachment":[{"href":"https:\/\/marstomato.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=53"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/marstomato.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=53"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/marstomato.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=53"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}