OpenAI Next Funding Round Could Value Firm at $150B and Help It Stay Private
A new investment is expected to boost OpenAI's already huge valuation. Photo by Chip Somodevilla/Getty Images.
Key Takeaways
- OpenAI is reportedly in talks to raise several billion dollars of additional funding.
- The funding round would value the company at $150 billion.
- AI valuations have exploded thanks to surging Big Tech investment.
OpenAI is in talks to raise several billion dollars in a new funding round that could value the startup at $150 billion, Bloomberg News reported on Wednesday, Sept. 11.
The Wall Street Journal previously reported that Thrive Capital is leading the round with an investment of around $1 billion. Microsoft, which has already invested an estimated $13 billion in OpenAI, is also expected to contribute.
OpenAI Latest Funding Round
The rumored funding would be the largest influx of external capital for OpenAI since Microsoft’s $10 billion investment in January 2023.
The push for more comes as competition heats up in the AI space, with companies like Google, Amazon, and Meta plowing billions of dollars into developing rival platforms.
Fierce AI Competition
Although ChatGPT remains the market leader with hundreds of millions of monthly users, increasingly sophisticated alternatives from Google, Anthropic, Meta, and others mean competition between AI providers is red hot.
The ongoing technology race has seen billions of dollars flow into AI development, causing valuations to soar.
After OpenAI, Anthropic tops the leaderboard of most valuable AI labs, with the latest estimates valuing the startup at $18.4 billion. Third and fourth place go to Mistral and Cohere, which were reportedly valued at $6.6 billion and $5.5 billion at their last funding rounds.
Behind these major AI players is a group of Big Tech backers helping to finance their development.
Anthropic has received investment from Google and Amazon, Cohere is backed by Cisco and AMD, and Microsoft has thrown its weight behind Mistral and OpenAI.
Microsoft’s Relationship With OpenAI
Although it is OpenAI’s largest investor, Microsoft doesn’t technically own any shares in the company.
Instead, in return for its investment, Microsoft received exclusive access rights to OpenAI’s latest language models. It is also entitled to 49% of OpenAI’s profit until it has recouped the value of its investment.
The unusual and secretive nature of the deal has been subject to intense regulatory scrutiny, with authorities in the E.U., U.K., and U.S. all investigating the agreement for potential antitrust violations. In an apparent bid to assuage these concerns, Microsoft vacated its seat on OpenAI’s board in July 2024.
It isn’t clear whether the latest top-up impacts Microsoft’s existing relationship with OpenAI. Neither company responded to CCN’s request for comments.
