Can OpenAI keep its lead in the artificial intelligence arms race?

On November 30, 2022, OpenAI released ChatGPT. Two months after its launch, ChatGPT reached 100 million users. To illustrate just how impressive that is, it took TikTok nine months and Instagram over two years to reach the same user milestone.

The Basics of OpenAI’s ChatGPT

ChatGPT is an artificial intelligence-based chatbot that employs a large language model to provide users with human-like responses to a diverse range of prompts and questions.

ChatGPT can write content, summarize documents, translate text, and even generate code in a multitude of programming languages. The list of use cases for ChatGPT continues to grow, from writing essays for students to creating recipes from scratch. The category of tools ChatGPT falls into is commonly referred to as generative artificial intelligence or generative AI.

Following such a meteoric rise, there has been a deluge of headlines about ChatGPT, OpenAI, and generative AI tools. Some even believe that OpenAI has forever changed the way content is created.

What is the competitive landscape for generative AI right now?

OpenAI recently inked a strategic partnership with the management consulting firm, Bain & Company and Microsoft announced a multi-billion dollar investment in OpenAI along with plans to integrate OpenAI technologies into existing Microsoft products. Outside of OpenAI, there has been significant venture investment into AI-related startups and significant investment into internal AI teams at the world’s largest tech firms.

Below we highlight a few of the current and forthcoming ChatGPT competitors from global tech giants.

Google launched its answer to ChatGPT in “Bard” which is powered by Google’s Language Model for Dialogue Applications (or LaMDA for short). Google has also made a significant investment into Anthropic, whose AI chatbot Claude is still in Beta.

Meta has a dedicated AI team and released an AI chatbot, Blenderbot, targeting academic researchers in August of 2022, that tool received criticism from the public for incoherent and mistake-ridden responses. Blenderbot is still live and Meta is still investing heavily in AI.

Alibaba shares jumped in early February when it was announced the “company is working on a ChatGPT-style of technology and it is currently being tested internally at the firm.”

Baidu plans to implement its artificial intelligence chatbot Ernie into its search engine this month. Baidu’s answer to ChatGPT isn’t just an overnight response to OpenAI, it was “born on PaddlePaddle, the homegrown deep-learning framework that Baidu had begun developing in 2013.” And over time, Baidu has generally kept pace with OpenAI, announcing Ernie just over a year after GPT-3, ChatGPT’s predecessor was released.

To summarize, there have been a lot of announcements but no competitor has shown the generative output to rival OpenAI’s ChatGPT. OpenAI’s newly announced GPT-4 seemingly widens that lead based on early reactions.

What is the investment case for OpenAI?

The amount of investment into artificial intelligence firms and ChatGPT competitors has numbered in the billions and doesn’t look to slow anytime soon. The Wall Street Journal has called it an “Arms Race.”

This is likely because some believe that artificial general intelligence isn’t far off, and whoever develops and controls such a powerful technology will be able to dominate countless markets and possibly ‘break capitalism.’ Thus, firms working at the cutting edge of artificial intelligence are most likely to stumble upon artificial general intelligence or other AI innovations that have commercial applications.

We thought our readers would enjoy hearing what ChatGPT itself had to say about investing in artificial intelligence. So, we asked it, “What do you think the most compelling reasons to invest in OpenAI are?” The unedited response is below:

OpenAI is a research organization that focuses on developing and advancing AI technology in a responsible and ethical manner. Some of the most compelling reasons to invest in OpenAI may include:

Innovation: OpenAI is at the forefront of AI research and development, and its team of world-class researchers and engineers are constantly pushing the boundaries of what is possible with AI. Investing in OpenAI could potentially lead to new breakthroughs in AI technology that could have significant impacts on many industries.

Responsible AI: OpenAI is committed to developing AI in a way that is safe, secure, and beneficial to humanity. By investing in OpenAI, you may be supporting the development of AI that is designed to be transparent, trustworthy, and aligned with human values and interests.

Strategic partnerships: OpenAI has established partnerships with leading tech companies, academic institutions, and government agencies to advance AI research and development. By investing in OpenAI, you may be supporting collaboration and knowledge-sharing across a wide range of industries and organizations.

It's worth noting that investing in any organization carries potential risks and rewards, and investors should always conduct their own research and consult with financial professionals before making investment decisions.

This is an impressive output, even including a disclaimer, considering we provided ChatGPT with no other context or information.

It makes one wonder just how good these tools will be one, five, and even ten years from now.

And that seems to be the primary investment case, that artificial intelligence will continue to improve and won’t end up a passing fad like crypto or NFTs. If you believe in the fundamentals of generative AI technology, you might be motivated to find ways to invest in companies innovating the most, like OpenAI.

Given the impressive user adoption as it stands currently, ChatGPT and OpenAI are winning the AI-powered chatbot race. It remains to be seen if they can keep that lead going into the future. However, if they can, it means OpenAI could become one of the more valuable companies in the world.

How do I invest in OpenAI?

OpenAI is a private company and its shares are not traded on any public stock exchanges at this time. Currently, only investors that qualify and have the opportunity to invest in OpenAI can buy stock in the company.

We are excited to announce, however, that UpMarket has a limited allocation of OpenAI shares available for eligible investors.

You can read more about the offering and submit an application to see if you qualify by visiting this page to purchase shares in OpenAI.

Investors should note that OpenAI has a unique "capped-profit" structure that could impact the total returns for any OpenAI shareholders.

Conclusion

For years artificial intelligence was relegated to Sci-Fi and was something seemingly developed in the background but OpenAI’s ChatGPT brought AI into the zeitgeist. If the current pace of innovation holds, the potential for disruption is immense.

OpenAI’s early lead is not unquestionable, but it puts the company on a strong footing to set the pace of innovation for the entire generative AI space for years to come.