Block (Square)

OpenAI

Block (Square)

Block makes money across several business lines. Square (the seller ecosystem) charges merchants a flat percentage per transaction — 2.6% + $0.10 for in-person payments, higher for online.

Cash App takes a fee on instant deposits, Bitcoin trading, and Cash App Pay transactions. Afterpay (announced at $29 billion in 2021, though Block's share price fell so far before closing in January 2022 that the final price was closer to $14 billion) earns merchant fees on buy-now-pay-later transactions.

TIDAL is the music streaming service (acquired from Jay-Z). Block also earns Bitcoin revenue — Cash App is one of the largest Bitcoin brokers in the US, though margins on BTC trading are razor-thin.

OpenAI

OpenAI makes money primarily through API access and subscriptions. The API charges developers per token (roughly per word) for using GPT models in their applications.

ChatGPT Plus costs $20/month for individual users, ChatGPT Team is $25-30/user/month, and ChatGPT Enterprise is custom-priced. Microsoft pays OpenAI licensing fees and also resells OpenAI models through Azure OpenAI Service.

OpenAI's annualised revenue ran past $13 billion during 2025 and kept climbing from there, which is the kind of growth curve that normally only exists in a pitch deck.

Block (Square)

The origin story starts with Jim McKelvey, a glass blower in St. Louis and old friend of Jack Dorsey.

In 2009, McKelvey lost a $2,000 sale on a glass faucet because he couldn't accept credit cards. The customer wanted to pay with Amex.

McKelvey couldn't process it. The sale fell through.

McKelvey called Dorsey, who had been pushed out of the Twitter CEO job the year before and was serving as its chairman, and they started brainstorming. The problem was obvious: millions of small businesses, street vendors, farmers market sellers, and independent contractors couldn't accept credit cards because merchant accounts required monthly fees, credit checks, and clunky hardware that cost hundreds of dollars.

Dorsey and McKelvey wanted to make it so anyone could accept a credit card using just their phone.

They built a tiny white card reader that plugged into a smartphone's headphone jack. The reader cost almost nothing to manufacture and Square gave it away for free.

The software was simple — swipe the card, enter the amount, the customer signs on the screen, done. Square charged a flat 2.75% per transaction with no monthly fees, no contracts, and no minimums.

The product launched in 2010 and spread through small businesses like wildfire.

OpenAI

OpenAI was founded in December 2015 as a nonprofit AI research lab. The founding donors — including Elon Musk, Sam Altman, Peter Thiel, Reid Hoffman, and Jessica Livingston — pledged $1 billion with a mission to build artificial general intelligence (AGI) that would benefit all of humanity.

The idea was that AI was too important and too dangerous to leave in the hands of Google alone.

Sam Altman became chairman while Greg Brockman (former CTO of Stripe) became president. Ilya Sutskever, one of the most respected AI researchers alive, left Google Brain to become chief scientist.

The early team was stacked with world-class researchers who published their work openly — hence "Open" AI.

But AI research turned out to be staggeringly expensive. Training large models required millions of dollars in compute.

In 2019, OpenAI created a "capped-profit" subsidiary — investors could earn up to 100x their money, but profits beyond that would flow to the nonprofit. Microsoft invested $1 billion.

The mission was still to save humanity. The method now involved making a lot of money first.

Block (Square)

Square grew by giving away the hardware. The card reader was free.

That eliminated the biggest barrier for small businesses. A food truck operator, a yoga instructor, a farmers market vendor — anyone could start accepting cards in five minutes without spending a dollar upfront.

Square made its money on the transaction fees that followed.

The simplicity was the pitch. Traditional merchant services involved contracts, monthly minimums, tiered pricing, and hidden fees that required a finance degree to understand.

Square charged one flat rate for everything. No surprises.

That transparency built enormous trust with small business owners who had been burned by traditional processors.

Cash App grew through peer-to-peer payments and a brilliant viral strategy. The app launched in 2013 as a simple way to send money to friends.

Rappers, influencers, and content creators started using their $cashtag for tips and payments. Cash App sponsored hip-hop events and partnered with musicians.

By 2024, Cash App had over 55 million monthly active users — more than most banks.

OpenAI

ChatGPT's launch in November 2022 was the growth strategy — it just wasn't planned that way. The team expected a modest research preview.

Instead, ChatGPT hit 1 million users in 5 days and 100 million monthly active users in 2 months, making it the fastest-growing consumer application in history. The product went viral because it felt like magic — for the first time, anyone could have a natural conversation with a machine that seemed to understand them.

The Microsoft partnership provided distribution at massive scale. Microsoft integrated OpenAI models into Bing, Office 365 (Copilot), GitHub (Copilot), and Azure.

Overnight, hundreds of millions of Microsoft users had access to OpenAI technology. Microsoft's $13 billion investment was the largest AI bet in history and gave OpenAI nearly unlimited compute.

The API created an ecosystem. Thousands of startups built products on top of OpenAI's models — from customer service bots to coding assistants to content generators.

Each API customer locked themselves into OpenAI's ecosystem, creating switching costs and recurring revenue.

Block (Square)

The Afterpay acquisition was controversial. Announced at $29 billion in 2021, it closed in January 2022 at roughly half that after Block's own stock fell.

Buy-now-pay-later was already facing regulatory scrutiny and growing delinquency rates. Critics argued Dorsey overpaid at the peak of the market.

Afterpay's revenue growth slowed significantly after the acquisition, and write-offs on bad consumer debt increased. It remains the biggest bet Block has ever made.

The Bitcoin obsession worries investors. After renaming Square to Block in December 2021, Dorsey went all-in on Bitcoin — investing company cash in BTC, building Bitcoin mining hardware, and creating TBD (a Bitcoin-focused developer platform).

While Cash App's Bitcoin revenue is huge on paper ($10+ billion annually), the margins are tiny. Investors question whether the Bitcoin focus distracts from the core payments business.

Competition is intense on every front. Square competes with Stripe, Toast, and Clover for merchants.

Cash App competes with Venmo, Zelle, and Apple Pay for consumers. Afterpay competes with Klarna, Affirm, and bank-native BNPL products.

Block has to fight multiple wars simultaneously with finite resources.

OpenAI

The board crisis of November 2023 nearly destroyed the company. The nonprofit board fired Sam Altman as CEO on a Friday, citing a loss of confidence.

Within 48 hours, 95% of employees threatened to quit and follow Altman to Microsoft. By Tuesday, Altman was reinstated and the board was restructured.

The incident exposed the fundamental tension between OpenAI's nonprofit governance and its for-profit ambitions — a tension it finally addressed in late 2025 by restructuring the business as a public benefit corporation sitting under the original nonprofit.

The cost of training frontier models is eye-watering. Each new GPT generation costs hundreds of millions to train.

OpenAI is reportedly spending over $7 billion annually on compute. The company is burning through cash faster than almost any startup in history, which is why it keeps raising at higher and higher valuations.

If revenue growth slows before costs stabilize, the math gets ugly.

Safety concerns are not going away. Multiple prominent researchers have left OpenAI over disagreements about the pace of development versus safety research.

Ilya Sutskever, the chief scientist who was central to the board's decision to fire Altman, left in 2024 to start a safety-focused AI lab. The public debate about whether OpenAI is moving too fast — and whether its safety commitments are genuine — grows louder with every capability improvement.

Block (Square)

Square is the merchant ecosystem — point-of-sale hardware, payment processing, invoicing, payroll, loans, and online stores for businesses of all sizes. Cash App is the consumer side — peer-to-peer payments, direct deposit, investing, Bitcoin buying, and the Cash App Card (a debit card).

Afterpay is the buy-now-pay-later product — split any purchase into four interest-free payments. Square Banking offers business checking accounts and loans.

Square Online lets merchants build e-commerce websites. TIDAL is the music streaming platform that pays artists higher royalties.

OpenAI

ChatGPT is the consumer chatbot — the product that made AI mainstream overnight. The flagship GPT models are multimodal, handling text, images, and audio in one system.

The OpenAI API lets developers integrate GPT into any application. DALL-E generates images from text descriptions.

Whisper transcribes and translates audio. Sora generates videos from text prompts.

GPT Store lets users create and share custom GPT agents. ChatGPT Enterprise gives businesses a private, secure version of ChatGPT with admin controls and no data training.

Block (Square)

Khosla Ventures, Sequoia Capital, Kleiner Perkins, Visa, Goldman Sachs, GIC (Singapore)

OpenAI

Microsoft ($13B), Thrive Capital, Khosla Ventures, Sequoia Capital, Founders Fund, Tiger Global, SoftBank, a16z