- Funding round attracted tech giants such as Microsoft, Apple, Nvidia and Abu Dhabi’s MGX, and a plethora of prominent venture capital firms, including Thrive Capital, Khosla Ventures, alongside Altimeter Capital, Fidelity and SoftBank.
With the investment of $6.6 billion from prominent venture capital firms, Microsoft, Nvidia, Apple and Abu Dhabi’s MGX, OpenAI has become one of the most valuable private companies in the world.
The company’s valuation has also risen from $14 billion in 2021 to $157 billion as it grew revenue from zero to $3.6 billion, far exceeding Altman’s own projections at the time.
The influx of capital underscores the heightened interest in artificial intelligence and its transformative potential in various industries.
The funding round attracted a plethora of prominent venture capital firms, including Thrive Capital and Khosla Ventures, alongside Altimeter Capital, Fidelity and SoftBank.
Although Apple, a potential investor, ultimately declined to participate in this funding round, the overall enthusiasm among existing and new investors reflects a strong belief in OpenAI’s ambitions, particularly its ongoing pursuit of artificial general intelligence (AGI).
However, the announcement of this funding coincided with significant organizational changes at OpenAI. The abrupt exit of Mira Murati, the company’s long-serving Chief Technology Officer, has provoked questions about internal stability during this crucial period.
Despite these challenges, investor enthusiasm remains robust, buoyed by optimistic revenue projections from CEO Sam Altman. OpenAI anticipates generating $3.6 billion in revenue this year, from a mounting loss of over $5 billion.
It projects major revenue jump next year to $11.6 billion, according to sources familiar with the figures.
The funding was structured as convertible notes, contingent upon OpenAI’s successful transition to a for-profit entity.
The transformation involves relinquishing control from its non-profit board and eliminating caps on investor returns, a strategy crafted to align investor interests with long-term profitability. Investors have also secured provisions allowing them to recover funds or renegotiate valuation should these structural changes remain unimplemented within two years.
The goal, to develop AI systems that exceed human cognitive abilities, illustrates the company’s commitment to innovation and market leadership.