It frowned upon when Elon Musk announced that AI startup Xai had acquired social media company X (formerly known as Twitter). But in many ways, trading makes sense. Xai’s chatbot Grok has already been deeply integrated with X, and X has a financial inspiration, with Musk needing a way to make his $44 billion Twitter acquisition look like an AGI-dominated strategic play.
He also pointed out a deeper look at how the mask empire works. Investing in any of his companies is not a quick return on investment. It is to buy the mysticism around musk and swallow the entire story of success that exceeds the actual number.
Some call it glyft. But the market becomes increasingly tolerant, especially when the thread that connects the story is one of the president’s right hand.
“Elon’s companies today are all basically one company,” Yoni Rechtman, principal of Slow Ventures, told TechCrunch. “It’s all already Elon, Inc. People working at multiple companies at the same time. They share a web of capital connections. They have business with each other and he treats them all as one company. [the xAI-X merger] Two businesses end some of the separated fiction. ”
The idea among musk bulls like Ron Baron, founder of investment management firm Baron Capital, is, “all things.” [Musk] As Baron said, it’s about supporting everything else he does. Other businesses under the control of Mask include Tesla, SpaceX, the boring company and Neuralink.
“when [Musk] I bought Twitter and did he remember that there is an opportunity to have a great value in this data, licensing? When he decided to go to Mars on SpaceX, did he really think that there was a real opportunity on the internet around the world? When he started with Tesla’s EVS, did he really think this would merge with autonomous driving? […] And do you have cars connected all over the world? […] All of these businesses are linked. It’s an ecosystem. It’s Elon Ecosystem and I think it’s really interesting when you see it like that. ”
Baron Capital invests in the entire mask ecosystem, an example of investor crossovers among a variety of billionaires. Companies such as 8VC, Andreessen Horowitz, DFJ Growth, Fidelity Investments, Manhattan Venture Partners, Saudi Arabia’s PIF, Sequoia Capital and Vy Capital also hold positions across Musk’s corporate web.
It brings us back to Xai-X trading. Experts questioned how the acquisition could rate X at $33 billion, how to value X at $80 billion, considering its valuation value was more than tripled just a few months ago, and AI companies reportedly have little way to earn money. However, evaluations are not always based on what exists today. Rather, they take into account what investors want – and that’s especially true when it comes to mask ventures.
Look at Tesla. Electric car makers have been treated like high-tech stock for many years, despite the fact that Tesla has a margin for automakers based on the belief that one day it will unleash groundbreaking autonomy in the form of self-driving cars and humanoid robots.
“The reason [Tesla’s] “Stock trading in COMP Group transactions with 80x revenue and 25x revenue is something people are betting in the long term, not about what will happen to this year’s figures,” said Gene Munster, managing partner at Deepwater Asset Management.
Munster’s company invests in X, Xai and Tesla. Assuming that Mask can actually offer the pledge to marry X’s real-time data trobe and distribution platform and Xai’s infrastructure and AI expertise, it’s exactly the type of all-in-mask supporter who can benefit most from transactions like Xai Buying X.
Of course, integrated value also has a higher risk.
Dan Wang, a professor at the Columbia School of Business, told TechCrunch that research is at the intersection of business and society, and that the biggest immediate risk factor for investors is the ongoing litigation X faces from the Securities and Exchange Commission (SEC). The lawsuit accuss Musk of being a misleading investor by delaying disclosure of previous investments on Twitter. The SEC claims this has allowed Musk to artificially buy more Twitter stocks at lower prices.
Wang listed several other risk considerations, including anti-competition and user privacy concerns, particularly regarding the way X quietly chose all users to collect data for AI model training. The opt-in change has already raised the outrage of one regulator, the Irish DPC, which has already launched an investigation into a potential violation of European GDPR law.
“Another kind of risk here is that there is no consensus framework for how the AI market is regulated, but we’ve already seen traces of this in Europe and until recently in California,” Wang said. “Many of these frameworks have to do with how AI models are deployed in terms of information distribution. […] They take responsibility for the companies that are creating AI models and provide access to those models. ”
Musk may also simply lose interest in the project, Letchman said.
“I think that’s what a lot of Tesla shareholders are feeling right now,” he said.
When asked about some of these risk factors, Munster appeared to be no positive. He suggested that they were not important given the Xai value proposition, for example, and the enormous potential of becoming the dominant player of AI.
“We are betting on the company about our belief that AI will be more transformative than people think,” he said. “What is the value? […] One of the four brains the world continues to run on? ”
Rechtman said the mask bull is not blindly loyal, but simply trusts the musk superpower in itself, “to his will” and “to his will” in a way that allows him to do things and build a business that no one else can.
“The people in these businesses have just become long-time Elons and they will continue to go to long-time Elons,” Rechtman said. “So it’s not surprising to me that they keep telling you that the emperor is dressed.”
There is no purchase to Musk’s more speculative bets like X, so one way to increase Muskverse’s investment opportunities is, according to Rechtman.
“SpaceX is authentic and never publicly available,” he said. “So the only way to invest in SpaceX is to access your bids, and the only way to access your bids is to be in Elon’s good bounty.”
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