OpenAI Eyes $150 Billion Valuation Amid Massive Fundraising Push

OpenAI is reportedly in discussions to raise $6.5 billion in equity financing, a move that would catapult its valuation to an impressive $150 billion. The potential funding round marks a significant leap from the company’s earlier valuation of $86 billion, positioning OpenAI as one of the most valuable startups globally. Sources familiar with the matter, who spoke on the condition of anonymity, disclosed these details to Bloomberg.

Since its launch in 2015, OpenAI has been at the forefront of the artificial intelligence revolution, especially with the release of its popular ChatGPT product in 2022. The chatbot’s ability to generate human-like text and realistic images from simple prompts has not only captivated users worldwide but also attracted the attention of major investors and tech companies.

Simultaneously, OpenAI is in talks with major financial institutions to secure a $5 billion revolving credit line, which would further bolster its capital base. While specific details on the credit facility are yet to be finalized, this move aligns with a broader strategy seen among tech giants, where credit lines help deepen relationships with banks ahead of a potential initial public offering (IPO). Historically, companies like Meta (formerly Facebook), Alibaba, Uber, and DoorDash have sought similar arrangements as part of their growth trajectory.

The latest funding round is expected to be led by Thrive Capital, with Microsoft, the startup’s largest investor, also playing a major role. Tech giants Apple and Nvidia have also been engaged in talks to participate in this round. While Thrive and other involved parties have refrained from commenting on the discussions, the potential involvement of these industry leaders signals continued confidence in OpenAI’s future prospects.

The influx of capital is expected to support OpenAI’s escalating demand for computing power, which is critical to the development and deployment of its advanced AI models. In a recent memo to employees, Chief Financial Officer Sarah Friar emphasized that the financing would not only cover operational costs but would also allow employees to sell some of their shares through a tender offer later this year. This would provide liquidity to the team and align with OpenAI’s broader goal of sustaining its rapid growth and innovation.