In the case of Anthropic, the revenue has gone as high as $50 million per megawatt. What that now enables them to do is: 'Hey, if I spend 10 bucks on inference capacity, I actually generate 50 bucks of revenue, and then I can turn around and incrementally spend all of that profit on training.'
What is fungible is what is constructed from tokens, which is to say intelligence. In other words, if both Kimi and Sol generated the right answer, then that answer is fungible; the difference in tokens generated to get to that right answer is a contributor to a difference in COGS.
According to Xu, HeyGen hasn't really burned cash since it reached $10 million in ARR three years ago. Instead, the company proudly tracks a couple of other metrics: revenue for every dollar raised (now up to $2.70 for each $1 invested) and revenue per employee (now up to $1.5 million per full-time staffer).
In traditional SaaS, serving an extra free user costs essentially zero. In AI, every time a free user hits "Enter," your GPUs fire, and your cash burns. AI products need to figure out monetization quickly, or compute costs will bankrupt your company.
4mo ago
The difference between a mediocre business and a great business is that the great business finds a way to do the same thing at 1/10th the cost. Most people focus on revenue growth; they should focus on unit economics.
5mo ago
Underscored — save the words that stop you in your tracks.
