The Time to Invest in Belief

The world of finance is abuzz with news surrounding OpenAI, a company currently in talks to raise as much as $40 billion in a new funding roundValuations are expected to soar upwards, potentially reaching a staggering $300 billionLeading this round is SoftBank, with discussions indicating that they are prepared to invest between $15 billion and $25 billion, while the remaining capital will be sourced from other investorsJust last October, OpenAI managed to secure $6.6 billion, resulting in a valuation of $157 billionWhat lies ahead in this financing saga remains a compelling narrative.

Yet it is crucial to recognize that the current funding process is laden with significant dramaEven with success in this venture, it may ultimately boil down to the returning of lead money while the co-investors receive a smaller cutThe real challenge is attracting enough co-investors to join the fray.

The legacy of Wall Street has been built on successive rounds of financing, where companies consistently see their valuations riseInvestors who join earlier in the journey often stand to make impressive profitsHowever, there exists another layer to this narrative: the unearthing of affordable capital that may leverage the potential for monopolistic advantages in the marketUltimately, this intricate dance aims for a successful public listing on the U.S. stock market, handing over ownership stakes to retail investors worldwide, thereby effecting a grand exit.

This financing journey, then, is far from overIt is still in the lead and co-investor phases—and it is premature to call it a day until the company sights an IPOIn the wake of DeepSeek's emergence, OpenAI's valuation appears vulnerable, signaling that it is indeed time to reinforce beliefs about the company and its prospects.

To be frank, DeepSeek has taught us a lesson, including myself as an investor, casting doubt on whether many industries heavily invested in technology development truly follow a singular path

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This raises an essential question: Are the leaders on this path secure? Can they genuinely achieve a monopolistic advantage and profitability? Can past growth be reliably extrapolated to forecast future performance?

This is a question that has surfaced repeatedly throughout history.

My last encounter with a comparable concern was regarding lithium-ion batteriesAt the time, I found myself pondering a considerable risk: What if a startup unveiled a solid-state battery technology? Would this render lithium-ion obsolete? However, vast sums were poured into CATL (Contemporary Amperex Technology Co., Limited), which ultimately capitalized on a winner-takes-all scenario, leading to a profitable positive feedback loop that only strengthened their R&D capabilities, currently putting them at the forefront of solid-state battery development.

Yet, this time around, the competitive landscape has shifted with artificial intelligence (AI) becoming a focal point in global rivalries; here, the stakes are dramatically heightenedIn this scenario, emerging with a new path may lead to a dire zero-sum gameTechnology does not equate to brand loyalty or faith; rather, it relies on empirical data and verifiable facts—far removed from consumer goods, which is precisely why even Warren Buffett himself admitted to his struggles with tech stocks.

It’s apparent that Buffett penetrates the essence of situations, while many investors are still a few potent lessons shy of that depth of understanding.

Assessing DeepSeek's Feasibility

So, how efficient is DeepSeek? Although the company has open-sourced its large model, skepticism persists among observers regarding its performance and capabilitiesWhile many are quick to denounce the efficacy of various tests, often wishing they could confirm a lackluster performance, the recent lead of Chinese open-source AI models has made believers harder to find.

However, assertions alone carry little weight; real judgment comes from governmental sanction

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Assertions of technological superiority are inconsequential without the U.S. backingConversely, even if a company holds the potential for innovation without the spotlight, U.S. sanctions serve as ominous markers of genuine technological prowess, often undisclosed to the publicDeepSeek might still face skepticism, but preliminary certifications from U.S. authorities have already circulated, positioning them as a credible force.

Currently, the U.S. government is launching a national security investigation into DeepSeekOn January 28, officials voiced their views on DeepSeek's implications for the U.S., labeling the endeavor as akin to “theft” and catalyzing security inquiriesThis comes on the heels of the U.SPresident praising DeepSeek as a progressive technological milestone.

In alignment with the principle that any leader poses a threat to U.S. national security, it is evident that DeepSeek is indeed aheadThus, claims that it threatens U.S. national security are not unfounded; it stands to disrupt U.S. stock valuations substantially and potentially brings American markets closer to destabilization.

Encroaching upon someone’s financial territory equates to a dire confrontation, making DeepSeek’s actions highly contentiousThe U.S. market is inundated with AI-related stocks, all while experiencing valuation pressures regardless of their previous successThe core reason behind this turmoil is the fundamental shift in valuation frameworks, spurred by DeepSeek’s low-cost, high-output advantage, upending the previously harmonious narrative spun between AI enterprises and Wall Street.

Consequently, the voices threadbare with disdain for DeepSeek are not exaggerated; an outburst towards its immediate dissolution is becoming increasingly palpableThey have likely begun resorting to underhanded tactics—without issue—yet solutions remain elusive, even as they confront a disruptive innovator.

Reports from DeepSeek’s official website indicate that their online services faced significant malicious attacks, with experts tracing the IP addresses back to locations in the U.S.

DeepSeek’s most discomforting aspect for its competitors is not merely the impressive ROI they’ve achieved but the fact that they’ve opened access to their tools

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