OpenAI recently completed a significant capital raising round, raising the company’s valuation to $157 billion. This milestone was achieved through a $6.6 billion funding round, marking one of the largest investments in Silicon Valley to date. Thrive Capital led the investment round, with participation from notable entities such as SoftBank, Microsoft, Nvidia, Tiger Global, and MGX—a UAE-controlled investment company.
During the negotiation process, CEO Sam Altman expressed a desire for exclusive investment, urging investors to refrain from supporting rival companies such as Anthropic and Elon Musk’s xAI. This strategic move is aimed at safeguarding OpenAI’s position in the market and limiting competitors’ access to capital and strategic partnerships.
The new funding will be instrumental in advancing OpenAI’s research and development efforts, including the development of GPT-4 and the acceleration of Sora, a tool designed to create videos from text. Despite significant expenditures on computing power and talent acquisition, OpenAI remains focused on maintaining rapid growth.
However, the company is currently facing human resources challenges, with top scientists leaving the organization. Additionally, Chief Technology Officer Mira Murati recently announced her unexpected resignation. In response to these challenges, CEO Sam Altman is restructuring the business, shifting away from a non-profit orientation, and granting investors increased rights if the startup becomes profitable.
It’s worth noting that OpenAI, which was established as a nonprofit in 2015, is now undergoing a transition that allows for potential monetization and investor accountability. This shift has sparked rumors about Sam Altman potentially receiving shares in OpenAI, although he has consistently denied these claims.
The company is also embroiled in a lawsuit filed by Elon Musk, one of its co-founders, who accuses OpenAI and Microsoft of deviating from their non-profit mission and prioritizing profit over community service.