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OpenAI in Talks to Raise Funds at $150 Billion Valuation

Published at: September 12, 2024

Introduction AI leader OpenAI, the company behind the viral chatbot ChatGPT, is reportedly discussing raising funds at a staggering $150 billion valuation. According to Bloomberg News, this move would cement its status as one of the most valuable AI startups globally.

OpenAI’s Fundraising Goals


$6.5 Billion from Investors


OpenAI is currently seeking to raise $6.5 billion from investors. This fundraising round would elevate the company’s valuation significantly, placing it 74% higher than its previous $86 billion valuation earlier this year.

Related: Nvidia Revenue Soars 122% Amid High AI Chip Demand

$5 Billion Revolving Credit Facility


In addition, OpenAI is pursuing $5 billion in debt from banks through a revolving credit facility. These funds are aimed at furthering OpenAI’s AI technology advancements, enabling the company to scale even more rapidly.

Microsoft’s Backing and OpenAI’s Growing Influence


Support from Microsoft


OpenAI is strongly backed by Microsoft, which has played a crucial role in supporting its growth. Under the leadership of Sam Altman, OpenAI has risen to the forefront of the AI industry, particularly with the success of its ChatGPT platform.

Related: Amazon Acquires AI Chipmaker for $80M to Boost Edge AI

OpenAI’s Growing Valuation


OpenAI’s valuation increase has drawn attention from both private equity firms and venture capitalists. Major investors, such as Thrive Capital, are reportedly involved in this latest funding round, though they have yet to make a public statement.

Private Funding vs. IPO


Avoiding an IPO for Now


While many startups opt to go public, OpenAI’s $150 billion valuation will allow the company to remain private for a longer period. High regulatory costs and stock market volatility have led many AI startups to pursue private equity funding instead of an IPO.

Related: With Apple Intelligence, iPhone Users Will Finally Get a Smarter Siri

Liquidity for Venture Capitalists


Despite staying private, there is still a desire for liquidity among venture capitalists. As Chelsea Childs, partner at Ropes & Gray, points out, "Venture capitalists are going to want some liquidity," whether through a company sale or an IPO.

OpenAI Joins the “Private Magnificent Seven”


Listed by Forge Global Holdings


OpenAI’s growth has earned it a spot on Forge Global Holdings' list of the “Private Magnificent Seven” startups. This prestigious list includes tech giants like Microsoft, Apple, and Google-parent Alphabet, further highlighting OpenAI’s influence in the tech world.

Future Outlook for OpenAI


Continuing to Lead the AI Space


With this latest round of fundraising, OpenAI is poised to remain a key player in the AI industry. The new capital will allow the company to continue pushing the boundaries of AI technology, solidifying its position as one of the top AI startups globally.

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Author Details

Shubham Sahu
Content Writer

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