Tropic

OpenAI

Tropic

Tropic charges an annual subscription based on the customer's software spend under management. The platform pays for itself through savings — if Tropic helps a company save $500,000 on software renewals, the subscription cost is a fraction of that.

Some pricing includes a success fee tied to actual savings achieved.

The value proposition is mathematically clear: Tropic typically saves customers 23% on their SaaS spending. For a company spending $5 million annually on software, that's $1.15 million in savings.

Tropic's subscription fee is a small percentage of those savings, making the ROI calculation trivially obvious.

The data moat grows with every customer. Each contract that flows through Tropic adds to their pricing benchmarks database, making their negotiation intelligence more accurate for future customers.

This is a classic network effect — the more companies use Tropic, the better it works for everyone.

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.

Tropic

David Campbell spent years in SaaS sales and noticed something absurd: companies buying software almost never negotiated. They'd receive a quote, maybe push back slightly, and sign.

Meanwhile, the vendor knew exactly what discount they could offer because they had data from thousands of deals. The information asymmetry was massive — and it always favored the seller.

Campbell founded Tropic in 2020 to flip that asymmetry. The core insight was that if you aggregate pricing data from thousands of SaaS contracts across hundreds of companies, you can tell any buyer exactly what fair market price looks like.

Basically, "Company X is charging you $50 per user for this tier, but companies your size typically pay $32." That data-driven approach turns every negotiation from guesswork into science.

The timing was perfect. Post-COVID, companies were drowning in SaaS subscriptions.

The average mid-market company uses 100-200 software tools. CFOs started demanding visibility into software spend, and finance teams had no tools to manage it.

Tropic stepped into that gap with a platform that combined procurement automation with AI-powered negotiation intelligence.

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.

Tropic

Tropic grew by selling to CFOs with a message they couldn't resist: "we will literally save you more money than we cost." In a market where every other tool adds to the tech stack cost, Tropic reduces it. That positioning is powerful during economic downturns when CFOs are cutting budgets.

Customer success stories spread quickly. When a finance leader saves $500K on software renewals using Tropic, they tell other finance leaders.

The procurement community is tight-knit, and word travels fast at CFO conferences and finance Slack communities.

The managed services component creates stickiness. Tropic doesn't just provide data — their negotiators handle the actual vendor conversations.

This "done for you" model means customers don't need internal procurement expertise. Once Tropic handles your renewals, bringing the function in-house again feels like a downgrade.

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.

Tropic

The procurement software market is getting crowded. Vendr, Zylo, Productiv, and Sastrify all target SaaS spend management from different angles.

Differentiation is challenging when every vendor claims to save customers money on software purchases.

Scaling the negotiation services team is operationally complex. Unlike pure software companies that scale with zero marginal cost, Tropic's managed negotiation service requires trained humans.

Each new customer needs real people conducting real vendor negotiations. Balancing human-led services with AI automation is an ongoing challenge.

Vendor pushback is real. As procurement platforms become more common, SaaS vendors are adjusting their pricing strategies to account for aggressive negotiation.

Some vendors have started offering "non-negotiable" pricing tiers or adjusting discount structures. The more successful Tropic becomes, the more vendors adapt their tactics.

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.

Tropic

Tropic Procurement Platform — the core system for managing the entire software purchasing lifecycle from request through approval, negotiation, and renewal. Tropic Intelligence — AI-powered pricing benchmarks from thousands of real SaaS contracts, showing customers exactly what fair market price looks like for any software vendor.

Tropic Negotiation Services — a team of professional negotiators who handle vendor negotiations on behalf of customers, armed with Tropic's pricing data. Tropic Spend Management — dashboards and analytics showing total software spend, upcoming renewals, redundant tools, and savings opportunities.

Tropic Intake — automated request workflows that route software purchase requests through the right approval chains.

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.

Tropic

Insight Partners led the Series B. Canapi Ventures was an early investor.

8VC and other venture firms participated in growth rounds. The company has raised approximately $105 million total across multiple rounds.

OpenAI

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