OpenAI Becomes World’s Most Valuable Private Company

OpenAI allows employees to sell shares, valuing the startup at $500 billion.

OpenAI has allowed current and former employees to sell shares worth $6.6 billion. The transaction valued the startup at $500 billion—a record for private firms, according to Bloomberg, citing sources.

The buyers included SoftBank, Dragoneer Investment Group, Thrive Capital, MGX, and T. Rowe Price.

The sale was not a traditional investment round. The funds went to shareholders and option holders, not the company itself.

In August, the company raised $8.3 billion at a $300 billion valuation. The round closed several months ahead of schedule as part of the goal to raise $40 billion by 2025. Investors included SoftBank, Thrive, T. Rowe Price, Dragoneer, Blackstone, TPG, Founders Fund, Sequoia Capital, and Andreessen Horowitz.

Recently, Meta has been actively recruiting researchers from OpenAI and other leading labs, offering compensation packages in the nine-figure range.

The sale of shares by employees might encourage them to stay with the company rather than accept lucrative offers from competitors.

The total volume of shares sold in the secondary round was below the maximum allowable amount. OpenAI agreed to a deal worth over $10 billion, sources noted. This may indicate that current and former employees are confident in the business’s long-term viability.

Back in September, OpenAI launched Sora 2—an updated version of its audio and video generator. Simultaneously, the company introduced a social app called Sora, where users can create videos with themselves and friends and share them in a TikTok-style algorithmic feed.