OpenAI seeks $30 billion at a $1.25 trillion valuation
The AI firm is pursuing a large private funding round rather than moving straight to an IPO.
By Yasmin Farouk ·
OpenAI is reportedly preparing to raise up to $30 billion in private capital at a pre-money valuation of $1.25 trillion. The effort is being led by Coatue and investors in the UAE, according to sources familiar with the matter. The company has declined to comment on the funding plans.
This is not the first time details of a massive raise have surfaced. Bloomberg reported a month ago that the AI lab was seeking to raise $30 billion at a $1.4 trillion valuation. Terms for the current round are still under negotiation and could change, according to reports from both CNBC and Bloomberg.
The involvement of UAE investors could be tied to a broader agreement. CNBC reports that the funding from the UAE might be coupled with a deal to secure more computing capacity for OpenAI from the country. This potential arrangement would link financial backing directly with access to the computational resources needed for the company's AI development.
Should this round proceed at the stated figures, the valuation would set a new record for the most valued private company ever. It would also establish a significantly higher benchmark for OpenAI's upcoming public offering. The company filed confidential paperwork for an IPO in June, following a previous funding round in March that valued the ChatGPT maker at $852 billion post-money.
A valuation exceeding $1 trillion for OpenAI would also have implications for its competitor, Anthropic. Reports from CNBC indicate Anthropic is seeking a valuation of $1.5 trillion to $2 trillion for its public debut. Anthropic raised $65 billion at a $965 billion valuation in May, a round many considered its last before an IPO.
Both companies are moving toward public markets. Anthropic filed confidential paperwork for an IPO in June as well. The competing moves to go public are unfolding as both firms continue to seek massive private funding rounds to fuel their operations.
The push for a $30 billion raise underscores the immense capital requirements for building and scaling artificial intelligence technology. The reported valuations for both OpenAI and Anthropic reflect the high expectations for their future growth. The terms for OpenAI's current round remain under negotiation.
Source: TechCrunch
