Sam Altman's comments on the prospects of startups hoping to break through in the AI business may have come back to bite him. Several posts on X (and probably other platforms) ridicule the OpenAI boss and co-founder's dismissal of potential competition emanating from the startup scene, particularly those with only limited financial resources in the range of $10 million. Altman's comments were made during a Q&A session after a 'Conversations' presentation to India VCs, recorded in June 2023. The comments seem way off the mark in early 2025, with DeepSeek now on the scene claiming its groundbreaking model only cost $5.6 million to train.
This is pretty hilarious in retrospect.In India in 2023, Altman was asked how if a small, smart team with a budget of $10 million could build something substantial within AI.His reply: "It’s totally hopeless to compete with us on training foundation models" https://t.co/pdYIhV2x1mJanuary 28, 2025
Entrepreneur Arnaud Bertrand reckons that Altman's response in the above clip is "pretty hilarious in retrospect." In other words, Bertrand thinks Altman's dismissal of the Indian VC's question about startups challenging the likes of OpenAI showed a startling lack of foresight.
The video begins with the VC stating that there is a very vibrant startup ecosystem in India. He goes on to muse whether Altman might see a gap in the AI business, one which an Indian startup could fill. More specifically, the VC asks whether a trio of super-smart engineers from India "with say, not $100M, but $10M – could build something truly substantial?"
Altman's response was quite dismissive of the VC's well-mannered query. "Look, the way this works is we're going to tell you it's totally hopeless to compete with us on training foundation models. You shouldn't try, and it's your job to try anyway, and I believe both of those things," was Altman's disjointed stream-of-consciousness style reply, followed by audience titters. "I think it is pretty hopeless," he added, possibly wishing to soften his initial response.
deepseek's r1 is an impressive model, particularly around what they're able to deliver for the price.we will obviously deliver much better models and also it's legit invigorating to have a new competitor! we will pull up some releases.January 28, 2025
To Altman's credit, earlier today he posted a thread on X praising the catalyst behind his recent social media ridiculing. The launch of China's DeepSeek has caused significant AI business and tech industry tremors, and Altman has now publicly admitted it is "an impressive model, particularly around what they're able to deliver for the price."
Nevertheless, like the funding-hungry CEO he is, Altman quickly turned the thread around to OpenAI promising jam tomorrow, with the execution of the firm's roadmap, amazing next-gen AI models, and "bringing you all AGI and beyond."
The amount of money DeepSeek truly spent on training its model, which it claims is $5.6 million, is contested. However, despite those contentions, it is clear that the company pulled off training a frontier model with disruptively low costs, shocking the US titans of AI.
