Debt would be SoftBank giving OpenAI $78 B in cash and then in a year or two asking for payments of cash back.
This investment/stock circular thing is like if you were building a house and lived next to a brick yard, and convinced the brick yard owner to give you bricks to build your house. Your house would be the demonstration of how lovely the bricks are, and in return you’ll give them 10% of the title of your property. If you sell that property in 2009 or 2024, the value will change, but that’s a risk and gamble you both take. And they can sell small parts of that 10% whenever they want, if they want.
None of that is debt. Debt would be a loan from the bank that requires payments over time.
The issue here is this isn’t debt!
Debt would be SoftBank giving OpenAI $78 B in cash and then in a year or two asking for payments of cash back.
This investment/stock circular thing is like if you were building a house and lived next to a brick yard, and convinced the brick yard owner to give you bricks to build your house. Your house would be the demonstration of how lovely the bricks are, and in return you’ll give them 10% of the title of your property. If you sell that property in 2009 or 2024, the value will change, but that’s a risk and gamble you both take. And they can sell small parts of that 10% whenever they want, if they want.
None of that is debt. Debt would be a loan from the bank that requires payments over time.
But where did OpenAI get the money to buy those chips (+10% of the company)?