New York (Khabarr) – On Friday Microsoft-backed OpenAI has concluded a transformative deal that values the artificial intelligence company at a staggering $80 billion or more. Sources familiar with the deal revealed that the company facilitated the sale of existing shares through a “tender offer” led by venture firm Thrive Capital.
Under the terms of the agreement, existing shares of OpenAI will be offered for sale, allowing employees the opportunity to cash out their shares, diverging from the conventional route of a funding round aimed at raising capital for business operations. This strategic move underscores the company’s evolution and its commitment to providing liquidity for stakeholders. Despite numerous requests for comment, OpenAI has yet to provide an official response.
This significant valuation represents a substantial increase from OpenAI’s previous valuation of approximately $29 billion, which was agreed upon in a similar deal early last year. Notably, venture-capital heavyweights including Thrive Capital, Sequoia Capital, Andreessen Horowitz, and K2 Global participated in the previous tender offer.
Investors and large firms are investing heavily in AI based companies. Anthropic, a competitor to OpenAI, has secured a staggering $6 billion in funding from tech giants Google and Amazon. Similarly, Cohere, a startup established by former Google researchers, amassed $270 million in funding, pushing its total funding beyond $440 million. Additionally, Inflection AI, founded by a former Google executive, concluded a funding round of $1.3 billion, bringing its total funding to $1.5 billion.
The surge in OpenAI’s valuation comes amid heightened interest in artificial intelligence technologies, particularly following the launch of ChatGPT in late 2022, which sparked widespread intrigue and exploration into the potential applications of AI. Moreover, OpenAI CEO Sam Altman has reportedly been engaged in discussions to secure funds for a chip venture, aiming to bolster global chip manufacturing capacity to support AI-related innovations. Altman’s strategic initiatives underscore OpenAI’s commitment to advancing AI capabilities and shaping the future of technology.
However, this latest deal also arrives amidst a backdrop of internal turmoil, with Altman facing a brief period of dismissal from the company’s board in late 2023 before being reinstated following employee outcry. Despite these challenges, OpenAI continues to attract significant investments, reflecting the growing importance of AI technologies in shaping the future of various industries. Recently, Open AI revealed its latest innovation: Sora, a revolutionary text-to-video tool poised to redefine content creation. This cutting-edge application harnesses the power of artificial intelligence to transform written prompts into captivating and original video content. Sora boasts the capability to generate sophisticated 60-second-long videos with remarkable precision and complexity. Such rapid innovations will help OpenAI reach new heights.
Moreover, in a bid to address concerns regarding chip scarcity, Altman is reportedly spearheading an ambitious fundraising effort to establish a new AI chip empire potentially worth up to $7 trillion. This endeavor will help to address the critical shortage of GPUs necessary for operating large language models, signifying OpenAI’s commitment to driving innovation and overcoming key technological barriers in the AI landscape. Altman’s vision and fundraising efforts aimed at surpassing the combined worth of industry giants like AMD, Nvidia, and Intel, reflect the company’s determination to carve out a significant presence in the semiconductor industry. As OpenAI continues to push the boundaries of AI innovation, its strategic maneuvers will undoubtedly shape the trajectory of the tech landscape in the years to come.