OpenAI Secures $6.6 Billion, Valued at $157 Billion

The AI firm OpenAI has raised $6.6 billion, valuing the company at $157 billion. This transaction ranks among the largest in the history of venture capital investments.

“The new funding will allow us to double down on leading-edge AI research, expand computational capabilities, and continue developing tools to help people solve complex problems,” the company stated in its blog. 

The startup’s valuation has nearly doubled in less than a year. In February, OpenAI agreed to sell its shares in a tender offer to Thrive Capital at a valuation of $86 billion.

The firm did not disclose the list of investors in its press release. Bloomberg, citing a source, reports that the round was led by Thrive Capital ($1.3 billion) with participation from:

• Microsoft — approximately $750 million in addition to the already invested $13 billion;
• SoftBank — $500 million;
• Tiger Global — $350 million;
• Altimeter Capital — at least $250 million;
• Nvidia;
• Khosla Ventures;
• Fidelity;
• MGX.

Thrive Capital retained the right to invest an additional $1 billion by the end of 2025 at the current valuation.

Previously, Apple withdrew from investment discussions.

Sequoia Capital also did not participate in the round, having supported the AI startup Safe Superintelligence, founded by former OpenAI lead scientist Ilya Sutskever.

According to FT, during negotiations, the developer of ChatGPT discouraged investors from backing rival firms such as Anthropic or xAI. 

The company generated $300 million in revenue last month, a 1700% increase from the previous year. It expects to earn $3.7 billion this year and $11.6 billion next year, as reported by CNBC. 

Due to high costs associated with training and maintaining AI models, OpenAI is effectively losing money. Earlier reports suggested that the company’s potential loss in 2024 could reach $5 billion.

ChatGPT has 250 million weekly active users and 11 million ChatGPT Plus subscribers. 1 million have purchased a business subscription. OpenAI executives are considering introducing high-cost plans, which could reach up to $2000 per month.

Previously, amid efforts to raise funds, the firm’s CEO Sam Altman informed employees that the startup’s complex corporate structure would likely be altered next year.

In June, it emerged that the company was considering a shift to a commercial business model.

According to Reuters, the funding was conducted in the form of convertible bonds, with their conversion into equity contingent upon OpenAI’s transition to a commercial business. 

Following reports of changes to the corporate structure, several key employees left the company. Altman stated that these events are unrelated. 

Additionally, the startup’s co-founder denied media reports of plans to acquire a “giant equity stake” in the firm. 

Elon Musk, head of rival xAI, has filed a lawsuit against OpenAI, claiming that its founders Altman and Greg Brockman breached the company’s founding agreement, prioritizing commercial interests over public good.