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 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.
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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.
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.
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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.
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.
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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’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.
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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