The Wall Street Journal recently reported that leadership wants OpenAI, the company, to focus. Seems like a plain old business strategy story. Nope!

First, in more prosaic terms, the all-hands and what was said was indicative of need for focus and urgency. I read it as mild panic stations. Second, step back enough and a clear and complete image should emerge. It reveals the real game being played. It is the grand hand at the big AI poker table. The IPO. Who gets there first, who sets the rules. And who really wins.

The IPO is not about one company. Instead it is about three American AI companies — Anthropic, OpenAI, and SpaceX, which owns xAI. It is about the scale of money to be raised from the market. It is also the urgency to do so. The Economist notes that if all three offer 15 percent of their shares, the combined sum would roughly equal every dollar raised across all American IPOs over the past decade.

It is against the backdrop of a global crisis, and this being a battle for winner take all. And most importantly, with the Middle East busy with bigger problems, the money spigot for American AI might be as tight as the Strait of Hormuz right now. The Gulf sovereign wealth funds that have been backstopping this AI frenzy have other fish to fry, at present.

Public market investors in New York and London will now have to carry the weight. Which means the IPO window is real, it is short, it is now, and it will not stay open forever. In short, this is a three horse race to the IPO market. And OpenAI isn’t the leading pony.

OpenAI was all over the map. Sora. A web browser called Atlas. A hardware device. TikTok-for-AI. All announced with the same breathless urgency, same press release energy, different product each time. Cashing in on the announcement economy.

Simo told staff last week they had to stop being distracted by “side quests.” That is a remarkable word for what was, in practice, an $840 billion company running several unrelated experiments inside itself while its most focused rival ate its lunch.

All startups, big and small, are messy. Some have more disorder than others. The admission of chaos is a way to show recognition, and eventual correction of the problems. The question to me, is why this admission of chaos? And that’s why you need to bring out the popcorn.

Let’s break down the WSJ news report itself. The fact that the Journal “reviewed” the transcript is a giveaway. The Journal didn’t say they had the transcript, or that it was leaked to them. “Reviewed by” is a tell. This is a controlled leak. Nothing wrong with it.

Companies do it often. Big publications like the Wall Street Journal get the scoops and exclusives. This is a game that has been played for the longest time. Every word attributed to Simo, from “side quests,” to “code red,” to the Anthropic “wake-up call,” was chosen for outside consumption, to shape the story.

Don’t get me wrong. While the actual new content of the story is thin, it is still real. The organizational dysfunction is real. The Sora team was housed under research while launching a consumer product — a good sign of that dysfunction. However, the Anthropic “wake-up call” framing is a classic Jedi mind trick. Admit competitive weakness to look clear-eyed to investors and customers, while simultaneously using a rival’s success as the proverbial carrot and the stick.

However, one has to read the story in a larger context. The WSJ report has to be read against other news this week. Reuters reports OpenAI is in advanced talks with TPG, Advent International, Bain Capital, and Brookfield to create a new joint venture valued at around $10 billion that would push its enterprise products through PE-backed portfolio companies across industries. It is forming “Frontier Alliances” with McKinsey, BCG, Accenture, and Capgemini, announced last month. This is a great narrative being put together for a company on a deadline, for a specific audience. OpenAI is great at building narratives. It might back its way into a long-term strategy, but for now, you have to see every piece of news coming out of OpenAI right now as part of a jigsaw puzzle.

There is one audience for this final picture. The bankers and institutional investors who will price the offering. OpenAI needs them to believe three simple things. It has its house in order. It has a real swing at corporate dollars. And that it is ahead in the AI race, both for consumers and corporations.

One thing odd, maybe just to me, is why OpenAI has been stuffing its ranks with former Facebookers who are known to juice growth, find edges, and keep people addicted. They have little background in getting enterprises to buy into a product. Simo herself ran the Facebook app. That organization’s genius is consumer engagement: behavioral hooks, dopamine loops, the relentless optimization of the feed. You can see that in the recent iterations of ChatGPT. It has become such a sycophant, and creates answers and options, that you end up engaging with it. That’s juicing growth. Facebook style.

The next shoe to drop would be news that OpenAI poached some big name executives from say, Salesforce or one of the big boy SaaS companies to take charge of the enterprise push. Right now, OpenAI’s own numbers show that its enterprise business generates $10 billion out of a total annualized revenue of $25 billion. In comparison, Anthropic, the smaller company, is widely regarded as ahead in enterprise adoption.

Why is all this important? Again, as I said, money. I know I am repeating myself. The public market money. That is the only real story. There are three AI companies heading toward public markets. Two have friends in Washington. One has a great satellite launch and Internet business. One has focus. One is perceived as an “all over the map” business.

Zoomed in, there is a reason why Grok and OpenAI are looking to go after the “code” business. Anthropic’s success is good enough proof that AI, despite all the talk of impending singularity and AGI, is all about software — the critical choke point in a digital-first world. That is the business. For now! Not orbital data centers. Not a social video app. Not a hardware device. All these may (or may not) be real money spinners in the future, but for now, you gotta focus on juicing your revenues to go public. Focus is the answer.

Anthropic’s revenue run rate has surged past $19 billion, up from $9 billion at the end of 2025 and roughly $14 billion just weeks before that. Amodei confirmed at Morgan Stanley that $6 billion was added in February alone, driven almost entirely by Claude Code. Revenue doubling in two months. That is the curve that makes a prospectus compelling without a PR campaign to explain it.

The US government has tried to change that calculus. Defense Secretary Hegseth declared Anthropic a supply-chain risk after it refused to give the Pentagon unrestricted access to its models. Altman positioned OpenAI as a bridge-builder while quietly moving to take Anthropic’s vacated government contracts.

Anthropic has no friends in Washington. What it has, in the immortal words of former Microsoft CEO Steve Ballmer, is “Developers, Developers, Developers.” Right now, developers are the ones who actually matter. Despite its somewhat unclear messaging and occasionally awkward public identity, Anthropic’s Claude Code is a product they want to use. Wallet always speaks the loudest.

I won’t be crying over OpenAI. They are doing $25 billion in annualized revenue, with 900 million weekly users, and a CEO who has proven he can bend a narrative to his will.

As I said before. When a grand hand is being played, focus is not such a bad thing. Especially when the billions you desperately need are on the line.

March 17, 2026. San Francisco.

When it comes to OpenAI, smart money is starting to do the math out loud. And something doesn’t add up. On surface, today’s news that OpenAI is offering 17.5% guaranteed returns to private equity firms looks like a shot at the Anthropic threat. Scratch the surface, and you start to see the story behind the story.

The PE deal is the kind of deal you do when you’ve borrowed against the future and the future is taking longer than expected.

Remember a few weeks ago when Nvidia CEO Jensen Huang (one of the backers of OpenAI) said that OpenAI was not a well-run business. Now Thoma Bravo founder Orlando Bravo is saying it out loud. Bravo walked away from the JV idea after questioning the long-term profit profile. It is not a coincidence that two smart money operators are arriving at the same conclusion. Just different words.

As I wrote in yesterday’s newsletter, (and in my breakdown of Nvidia GTC, Jensen’s Trillion Dollar Token Factory, for CrazyStupidTech) we are at an inference inflection. What that means is that AI goes from being in the “capex” phase to being in the “opex” phase. That shift is why you see Anthropic adding a billion or so in revenue every week or so. And that is why OpenAI is in a tizzy. And that is why Elon Musk has made “coding” a top priority for his Grok. All three companies are about “business” and revenues and not just promises.

OpenAI is good at promises. Especially the promises of a limitless future. And it has done a good job of borrowing against that future. Except, that future isn’t arriving or arriving fast enough.

It announced the $110 billion funding round, while only about $25 billion was near-term committed capital. Stargate was a $500 billion infrastructure promise. Oops. Each of these moments followed the same logic. Project confidence so large that the world treats it as reality. The reported PE deal is just the latest version of the same story.

The question to ask is why is OpenAI willing to guarantee 17.5 percent return? What gives. My harsh read of the situation is that the company needs money, and private equity is the last large pool of capital it can tap. And that tells you something about how many other doors OpenAI has already knocked on.

Here I go again with more questions than answers.

When I look at the news about the joint ventures, I read it as OpenAI cannot afford the cost of selling to big companies on its own. Deploying engineers to customize models for clients is expensive, slow, and margin-destroying. The joint venture shifts that cost onto PE firms while they think they’re buying access. They’re not. They’re picking up the actual cost of the work, dressed up as a partnership. It is a smart move, especially when you are preparing for a public offering.

Here is the line buried in the Reuters report that you should read again and again. The joint venture structure would provide “clearer segment reporting that can support the IPO narrative.”

Loosely translated (and financial analysts would be better to break this down), the JV structure allows OpenAI to create a line item that makes it look like it has recurring enterprise revenue, which is exactly what IPO bankers need to justify a valuation of a trillion dollars. The real product here is not AI. It is an IPO prospectus.

Maybe I am completely off base. There is almost certainly something we don’t know. There might be a product breakthrough that changes everything. OpenAI has surprised before.

However, it is hard to ignore that both Jensen and Bravo raised issues around OpenAI as a business. After all, no healthy business needs to offer terms that OpenAI is offering. You know why this is happening. It is because the need for cash is real. And the need to go public and get that cash is even more real. That 17.5 percent guarantee is just a magic number in magic math.

Previously on this topic:

• OpenAI Has New Focus (on the IPO)
• The Great AI Game vs AI Theater
• $110 Billion in Name Only
• Mad Money: The Big AI Race
• The Debt Beneath the Dream

An update to More Magic Math from OpenAI

The final mad dash to IPO is on for the big AI companies. SpaceX, OpenAI, and Anthropic have all made their intentions clear. And nothing could be more obvious about OpenAI’s intent than today’s new funding announcement. A few things have changed since I wrote that piece. Some confirm my thesis, and one surprise, though not really.

So, the company says the round closed. $122 billion in committed capital, up from the $110 billion announced in February. Does committed mean money has passed the transom? We won’t know. What we do know is that at a post-money valuation of $852 billion, the anchors are Amazon, Nvidia, and SoftBank. Microsoft participated again, though not clear for how much. The additional $12 billion came from a who’s who of institutional money, including a16z, Sequoia, BlackRock, Blackstone, Fidelity, Temasek, D1, and Dragoneer. The FOMO gang!

So many brand-name investors show up at the last minute because none of them want to miss out on the sweet IPO pop. It surely will win them points with their own (limited partner) investors. I guess FOMO is also an affliction for the super rich.

By the way, nothing puts more in “t “less is more,” than more itself. In 2024, OpenAI raised $6.6 billion and sold about 4 percent of the company. In 2026, they raised $122 billion, twenty times more, by selling roughly 14 percent. Existing insiders and early employees must be in heaven.

To be clear, the circular financing problem hasn’t gone away. Amazon’s $50 billion is tied to an eight-year AWS contract. Nvidia’s contribution is compute, not cash. When I wrote about this in March, it was just an observation. Now it has a name. Bloomberg, Reuters, and others are now calling it “circular financing.”

OpenAI says it now has a $4.7 billion credit line from JPMorgan, Goldman Sachs, Citi, Morgan Stanley, and Wells Fargo. That’s not a lending syndicate. That’s an IPO underwriter roster auditioning for the job. It reminds me of those lining up outside Don Corleone’s room on his daughter’s wedding day. The credit facility is the gift they bring to get in the room.

Now let’s talk about the fix. The $3 billion in investments from individual investors. Axios reports that they are customers of three of the largest banks. Wait, the same three large banks that extended the credit facility and want to be part of the IPO underwriting syndicate. More circular economy at work.

OpenAI CFO Sarah Friar told Axios, “We are really trying to take to heart our mission, which is AGI for the benefit of humanity and thinking about access. Not just access to the technology, but also access to the economic upside that it’s driving.” That’s a nice line. It’s also an IPO marketing strategy.

OpenAI said it will be included in several ARK Invest ETFs. Cathie Wood, who previously invested in OpenAI through her venture arm, now gets to channel her retail base into pre-IPO OpenAI shares. Think about what that is. A private company, not yet public, getting into retail ETFs. That’s a new thing. It’s smart, too. You create demand before the IPO. You distribute the story. You make millions of people feel like they have skin in the game before you even file. That’s the fix.

ARK is overrated, to put it mildly. ARK’s flagship fund peaked in February 2021, then fell 75 percent. Five years later, a thousand dollars invested then is worth about $573 today. And ARK is the vehicle OpenAI chose to democratize the upside. Make of that what you will.

One last thing. OpenAI is quietly pivoting, shutting down Sora, its much-hyped video app, and concentrating resources on a “superapp” for developers and business users, with coding assistants at the center. Why? Because enterprise is exactly where Anthropic is eating their lunch. The $122 billion has bought more time to beat the competition. And did you notice that CFO Friar is doing all the press versus Sam?

You focus this hard because you want to go public. Fast. After all, you don’t want to be the one without a chair when the music stops. Your move, Dario!

Previously on this topic:

• More Magic Math from OpenAI?
• OpenAI Has New Focus (on the IPO)
• $110 Billion in Name Only
• The Debt Beneath the Dream