If we're doing historical comparisons, there was so much hype for AOL and Yahoo that drove valuations far beyond the economics. In time, the hypesters were proved wrong.
In contrast, there was overwhelming doom and gloom for Google's IPO, in spite of their incredible growth and margin economics. In time, the doomers were proved wrong.
There's so much doom and gloom about Anthropic that directly contradicts their astounding growth and margins. For a long-term investor, Anthropic is looking a lot more like Google not AOL.
I can only hope the doomer narrative dominates until I can get a few shares at a reasonable valuation.
Vibes are almost always wrong. Ignore the vibes and focus on revenue growth rates and inference margins.
Google is an excellent example of the companies that followed after the initial batch of big dotcom companies. They ate Yahoo's lunch. The dotcom bust was in 2000, and Google went public in 2004.
I'm betting more on the successors to this initial group of AI companies. The ones that have to build actual profitable businesses.
Google was easily 10x better than any of their competition. It was effectively alone in the market.
Most of us were using 56k modems to access the internet back then, Google's search returned results within a couple of seconds. Yahoo, Lycos, Excite, Alta-Vista were still loading. Then the search results themselves were so good you could often just pick the first result. They eventually added a button which just took you directly to the first result. Which I used.
Yea, that's easy to say now.
I was a relatively early investor (2008), but I was very hesitant early on because Microsoft was building an integrated search function, which became Windows Live Search, which became Bing. I definitely remember it took me to the beginning of the financial crisis to finally decide that it was going nowhere. I suspect it was the development of Google Maps that changed my mind.
Curious, why do you say that as if the "I'm Feeling Lucky" button isn't still on the homepage in 2026?
Because it’s not there on mobile
I couldn't even tell you when I used the Google search page. It's been years at least. I wouldn't be surprised if many other people also don't go there to search. I assume most search straight in the url bar.
Home pages are still a thing are are often set to google
Because it is useless now.
> Alta-Vista were still loading
Your memory is faulty. AltaVista was always super fast--it never had the advertising bloat that the other ones had until the very end.
The problem AltaVista had was that it didn't scale when the Internet went exponential--so AltaVista would give you good search results until you asked current, topical questions. AltaVista relied on running a single, super-expensive stonking huge Alpha machine while Google ran on lots of commodity servers that spidered constantly.
This is inaccurate. When I was running AV operations around 2000, we were running on a couple dozen huge Alpha machines for the index layer and queries. We had a bunch of smaller machines for Web serving, and a high memory set of Alphas as a caching layer.
See https://www.usenix.org/legacy/publications/library/proceedin... for the 1997 server count, which was before we got to the three tier architecture.
We also spidered constantly. A couple of those huge backend Alphas were dedicated to holding the constant spider index. AV had a well earned reputation for quick discovery, although I think Google wound up faster. We suffered a bit from maintaining separate indexes for the main corpus and recent pages, and I imagine Google handled that better.
But the period of time when our main index went to hell was the period of time when we failed to do a new main index crawl for several months. I won’t get into why that happened politically because my memory isn’t perfect and I don’t want to criticize anyone who won’t see this to stand up for themselves, but it’s absolutely the case that we let the index get stale.
And I will say that I think the execs were distracted by the idea of challenging Yahoo by buying a shopping site and a local news site of sorts and, unlike the Google of the time, they lacked the wisdom to focus on our primary product.
And now I fade back into the hedges, until the next time AV comes up… I suspect a high percentage of my HN comments are on this exact topic. It makes me sad.
FWIW, I preferred AltaVista over Google back in the day.
I stand corrected. Thanks for all your work.
And I still miss the AltaVista illustrated diagram (Java Applet) that would allow you to drill down and specialize the search results. No modern search has ever matched that, again.
Webcrawler was faster than both!
When did Google pivot to advertising?
Before the IPO; AdSense came out in 2003. Before that they really make much money.
Simple text ads to start. It was built on MySQL, Java and C++ and became how they made most of their money.
"until I can get a few shares at a reasonable valuation"
I doubt you will. Most likely IPO reference price will be like SpaceX's, 100x ARR or so.
You're better off buying Google who own a huge chunk of Anthropic at a much saner average.
If it's 100x ARR then I'll watch from the sidelines.
But if it's 40x in October, and inference margin is strong, and revenue is still growing 20% per month, then I'm in.
I don't think it's really doom and gloom, that's mostly on here.
The normies are all still excited/scared and the valuation based on secondary trading is going up and up.
Maybe not quite as crazy as the dot com boom but I'd say the current environment for AI and related equities is a lot closer to the mid/late 90s than 2004
Normies are on fire for SpaceX, where the economics are horrible and the hype is off the charts.
Normies have never heard of Anthropic, where the economics are incredible and doom vibes are pervasive.
I think both have a similar amount of people who know about it. But it might just be my circle which is mostly in finance and some in engineering/medicine. These are also the type of people who actually invest. There's little doom vibes among those who're older if anything they're the one who think we'll get to some agi type situation.
I don't see how they can keep their margins with all the pressure from Chinise models. It got to be race to the bottom on margins.
They (together with OpenAI and maybe Google) can have better margins on frontier models, but the demand on those got to be much lower
> focus on revenue growth rates and inference margins
And ignore debt you can't pay back? Fine during ZIRP era because there was always another $50M around the corner. There is no extra $50B around the corner.
They've all over-invested in AI, same as the railroads, and it will collapse the same way.
They've changed the rules that will force these companies into every ETF commonly held by people's 401ks. The doomer narrative doesnt matter, they're forcing the common man to be the exit liquidty for the elite before the bubble pops.
So you're raising the topic of vibes, to tell us to ignore them.
Most of the time, they're wrong half the time.
I am really surprised that people are comparing dot com with AI. Atleast dot-com era was deterministic, comparatively AI is just a probabalistic unreliable slop
>I can only hope the doomer narrative dominates until I can get a few shares at a reasonable valuation.
I conjecture that some amount of the "doomer posting" is a consequence of other people realizing what you realized here and attempting to sway public sentiment for personal gain.
> astounding ... margins
Citation needed for that one.
Ah yes, time tested and battle hardened inference margins.
Anthropic is selling a commodity item that was just invented. It’s like investing in someone who is blowing lightbulb glass by hand.
We’ve already seen a startup make a chip which generates a hundred pages of text in milliseconds. When companies start bringing out hardware like that for cutting edge models, the entire business is dead. AWS will just eat the market.
History does not repeat itself, but it rhymes. Drawing these comparisons to the Dotcom bubble is only of limited utility. I think there's good reason to believe that recursive self-improvement is a bust, and LLM models will become a commodity. The real value lies in multi-modal integration and good harnesses. The current frontier labs are theoretically in a good position to capitalize on this, but it is far from obvious that they will succeed. I think Google and some of the chinese giants are in a far better position to actually go the last mile.