OpenAI Valued Over $100 Billion in Upcoming Funding Round

OpenAI Preparing for New Funding Round

The Wall Street Journal has reported that Microsoft-supported OpenAI is gearing up to raise at least a billion dollars in a new funding round. This would value the artificial intelligence company at just over $100 billion.

OpenAI's Largest Funding Round to Date

Sam Altman's chatbot startup company, founded eight years ago as a competitor to Google's DeepMind, is expected to receive $1 billion from venture capital firm Thrive Capital in this new funding round. This would be the most significant funding round of outside capital since Microsoft invested $10 billion into the chatbot startup in January 2023.

Previous Share Sales and Valuation

Earlier this year, OpenAI finalized a deal to sell existing shares through a tender offer led by Thrive. This allowed employees to sell shares at a valuation of around $80 billion, a significant increase from $29 billion just a year ago.

OpenAI's Revenue and Investor Participation

The Wall Street Journal provided further details, stating that AI is currently a speculative business that isn't generating as much revenue as investors and tech companies are investing in it. Earlier this year, OpenAI's revenue was $3.4 billion on an annualized basis, as per a person familiar with the matter. The Information had previously reported on OpenAI's revenue. The Journal also noted that it remains unclear which other investors are participating in the new funding round. Previous OpenAI deals have involved Sequoia Capital, Andreessen Horowitz, and K2 Global.

OpenAI's Valuation and Microsoft's Share

The Wall Street Journal obtained a document showing that OpenAI stockholders have been negotiating to sell their shares in recent weeks at a price that would value the company at $103 billion. Microsoft holds a 49% share of OpenAI's profit after investing $13 billion into the chatbot company since 2019.

OpenAI's Recent Developments

The news of the funding round comes roughly a month after OpenAI announced that it is testing SearchGPT, a combination of AI technology and real-time search data that allows users to search the internet with ChatGPT.

Altman's Possible Share Sale

It seems that Altman may have sold some of his shares...

Bottom Line

The potential valuation of OpenAI at over $100 billion is a significant milestone in the field of artificial intelligence. It's fascinating to see how this industry continues to grow and attract substantial investments. What are your thoughts on this development? Feel free to share this article with your friends and discuss it. Don't forget to sign up for the Daily Briefing, delivered every day at 6pm.