ChatGPT Maker OpenAI Raises $6.6bn In Funding
OpenAI closes $6.6bn funding round from big name backers, but reportedly asks them not to finance rival AI startups
OpenAI has closed its mammoth funding round that has seen significant investments from returning backers.
The company announced that it has raised $6.6 billion (£5.03 billion) from new investor Nvidia, as well as returning investors Microsoft and venture capital firms Thrive Capital and Khosla Ventures.
It is also understood that Altimeter Capital, Fidelity, SoftBank, and Abu Dhabi’s state-backed investment firm MGX participated in the funding round. Apple (a potential investor at one stage) did not invest in the end, despite it using ChatGPT to underpin ‘Apple Intelligence’.
OpenAI funding
This latest funding round values the company at a staggering $157 billion, making OpenAI one of the most valuable private companies in the world.
It comes as the AI startup is restructuring itself into “for-profit benefit corporation” – a significant move away from its “non-profit” roots.
The firm in its confirmation of the latest funding round revealed that “every week, over 250 million people around the world use ChatGPT.”
“We’ve raised $6.6B in new funding at a $157B post-money valuation to accelerate progress on our mission,” said OpenAI. “The new funding will allow us to double down on our leadership in frontier AI research, increase compute capacity, and continue building tools that help people solve hard problems.”
“We aim to make advanced intelligence a widely accessible resource,” said the firm. “We’re grateful to our investors for their trust in us, and we look forward to working with our partners, developers, and the broader community to shape an AI-powered ecosystem and future that benefits everyone. By collaborating with key partners, including the US and allied governments, we can unlock this technology’s full potential.”
Reuters, citing sources, reported that OpenAI is on pace to generate $3.6 billion in revenue this year on mounting losses of over $5 billion. It projects major revenue jump next year to $11.6 billion.
Executive exodus
The funding will welcome news for CEO Sam Altman, who is contending with major changes at the AI startup.
Last week when OpenAI’s ‘for profit’ restructuring move was revealed, three senior executives abruptly announced they were departing, including Chief Technology Officer Mira Murati, VP Research Barret Zoph, and Chief Research Officer Bob McGrew.
Those announcement come after an executive exodus at the firm over the past five months.
In August, OpenAI co-founder John Schulman had tweeted on X that he had joined rival AI company Anthropic AI.
Another co-founder, Greg Brockman, had also tweeted on X in early August that he was taking a sabbatical through the end of the year.
A third co-founder, chief scientist Ilya Sutskever, left OpenAI in May and started his own AI company called Safe Superintelligence Inc (SSI).
Days after Sutskever’s departure, his safety team co-leader Jan Leike also resigned and hit out at OpenAI for letting safety “take a backseat to shiny products.”
No others
As part of the funding round, investors have reportedly secured some protections that would allow them to claw back their capital or renegotiate the valuation if the restructuring changes are not implemented within two years.
Meanwhile, Reuters (again citing sources) reported that OpenAI has asked its investors to refrain from funding five companies it perceives as close competitors.
These competitors include OpenAI’s co-founder Ilya Sutskever’s new firm SSI; Anthropic; Elon Musk’s xAI; and AI search startup Perplexity and enterprise search firm Glean.
