Artificial intelligence giant, OpenAI has recently sealed a significant deal with venture capital firm Thrive Capital, catapulting its valuation to an impressive $80 billion or potentially more.
This remarkable surge nearly triples its value in just nine months, according to reports by the New York Times.
The deal involves OpenAI’s participation in an ongoing share sale through a “tender offer” led by Thrive, allowing the company’s employees to capitalize on their shares, providing them with a new investment avenue. Approximately 10 months ago, OpenAI concluded a notable $300 million share sale, positioning itself with a valuation of around $27 billion.
If validated, this recent development would position OpenAI as the third-highest-valued tech startup globally, placing it alongside esteemed entities like TikTok’s parent company ByteDance ($225 billion) and Elon Musk’s SpaceX ($150 billion), based on data from CB Insights.
The surge in OpenAI’s valuation reflects an exceptional trajectory in the competitive tech industry landscape. Discussions surrounding this deal were initially reported last year, with talks of a potential share sale. The Wall Street Journal suggested at that time that OpenAI’s valuation could reach an impressive $90 billion, showcasing robust interest and confidence in the company’s capabilities and potential trajectory within the tech market.
However, as news broke, both OpenAI and Thrive Capital have remained tight-lipped, providing no immediate responses to queries from Forbes. The nuanced details of the deal and its strategic implications for both entities are yet to be fully unveiled.
Founded in 2015, OpenAI has attracted significant investments from various tech companies and investors, solidifying its stature in the AI landscape. By the close of 2023, Microsoft had invested a substantial $13 billion in OpenAI. Notably, while Microsoft holds a significant stake, it does not own any portion of OpenAI but is instead “entitled to a share of profit distributions.”
Despite leadership dynamics upheaval last year, with CEO Sam Altman being ousted and later reinstated amid internal turmoil, OpenAI has explicitly communicated its lack of immediate intentions to go public.
In recent developments, OpenAI has introduced its latest product, Sora, a tool capable of generating videos from text prompts, showcasing continuous advancements in AI capabilities. However, this video service is not yet accessible to the public, as OpenAI navigates “several important safety steps” to address potential issues related to misinformation and bias before making it available for public use.
As OpenAI continues to scale new heights in valuation and product innovation, the tech industry, investors, and the general public eagerly await further insights into the trajectory and impact of these developments on the broader landscape of artificial intelligence.
