OpenAI closes deal valuing it at US$80b
OpenAI has concluded a deal with investors that reportedly values the California startup at US$80 billion or more, after a roller-coaster year for the inventor of ChatGPT.
The agreement, reported by The New York Times but not yet confirmed by OpenAI, would mean the value of the company – a world leader in generative artificial intelligence – would have nearly tripled in under 10 months.
The reported deal would have the San Francisco-based firm selling existing shares to investors led by Thrive Capital.
It would permit executives and employees to sell shares at a highly favourable price, just three months after the firm survived a major crisis when company co-founder and chief executive Sam Altman was fired and then brought back only days later.
OpenAI led a revolution in artificial intelligence when it placed its ChatGPT programme online in late 2022.
The immediate success of the interface sparked tremendous interest in the cutting-edge technology, capable of producing text, sounds and images upon demand.
Microsoft, already an investor in the start-up, redoubled its involvement.
The software giant has injected some US$13 billion into OpenAI in the past few years.
It is locked in fierce competition with Google to develop and roll out new tools using AI’s generative abilities, to the point that the US Federal Trade Commission in January launched an investigation into the enormous investments by Microsoft, Google and Amazon in the specialised start-ups.
OpenAI, founded as a non-profit in 2015, faced a major crisis last November.
Its board fired Altman, one of Silicon Valley’s more charismatic figures, accusing him of a lack of “transparence”.
In the following days, Microsoft tried to hire him, while both executives and a majority of OpenAI employees demanded that those behind Altman’s ouster resign and that he be rehired.
Within the week, Altman was back at work while several board members resigned.
Last Friday, OpenAI – developer not only of ChatGPT but of image- generating DALL-E – released a new tool named “Sora”, which can create realistic videos of up to a minute on simple demand.
According to the Times, OpenAI concluded a similar agreement early last year with venture-capital firms including Thrive Capital, Sequoia Capital and Andreessen Horowitz, which valued the firm at US$29 billion. – AFP
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
