New things tend to go through the well-known “hype cycle.” As we trend toward the “peak of inflated expectations,” some companies can exploit the opportunity and add substantial amounts to their market value (at least in the short term.)
We saw a few big waves of this with cryptocurrencies, NFTs, and the “metaverse.” The latest is ChatGPT.
Sometimes it’s a valid point. We’ve made the case for companies like Yext YEXT 0.00%↑ , where the arrival of ChatGPT and other good language models was a natural fit into their existing business and would serve to add value and generate more interest from potential customers. This is also possibly true for Perion Networks PERI 0.00%↑ on advertising.
If a business was bad before ChatGPT, it will probably not get better with it. When I saw that FiscalNote NOTE 0.00%↑ was up so strongly today on their announcement of being one of the few initial “trusted partners” for OpenAI on the ChatGPT platform.
More importantly, FiscalNote implied that the relationship was somehow exclusive and used the term “sole provider of legal, political, and regulatory data and information” in their release.
A careful reading of the ambiguous release makes it more likely that the exclusivity is about access to FiscalNote’s data, not that FiscalNote will be an exclusive source on the OpenAI platform.
Big difference.
Furthermore, no financial details or even a general business arrangement was included. Basically, this is an API that got in early.
FiscalNote is a rollup that went public via SPAC and has declined in price from $10 to $1.50 before the big spike up today to $2.30. Indications are the run will continue. Who knows how high it might go if there is a decent short position?
Traders might consider playing it on the long side for a continuation and possible short squeeze. It might also offer an attractive target for a short sale at higher prices. Many other sources of this information will be folded into all the “deep language models” that OpenAI, Microsoft, and Google put in the marketplace.