Artificial Intelligence start-up OpenAI has raised over $6.5 billion in its new funding round. Now, the post-money valuation of the company has increased to $150 billion.
The company emphasised that the funding will boost computing capacity and support the development of tools to help people tackle complex problems
Artificial Intelligence start-up OpenAI has raised over $6.5 billion in its new funding round. Now, the post-money valuation of the company has increased to $150 billion.
As per Reuters, Microsoft, Nvidia, Thrive Capital, and Khosla Ventures were some of the investors in the funding round. Other investors who participated in the round include Altimeter Capital, Fidelity, SoftBank, and MGX, which is an Abu Dhabi-based investment firm.
The company highlighted that the 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." The AI start-up also indicated that the funding would help them accelerate the progress of the mission. As per PitchBook, this is the biggest fundraising in the history of the USA. Further, this is also one of the biggest fundraise in the last 17 years that doesn’t involve a single major investor, as per data from PitckBook as reported by AP. Read: OpenAI's $5 Billion Problem Amid Leadership Crisis is Complicating Matters for Sam Altman
One of the reasons for the increased popularity of the company is because of its invention, ChatGPT, which has more than 250 million users. “Every week, over 250 million people turn to ChatGPT regardless of the scale of the challenge—whether it’s communicating with someone who speaks another language or solving the toughest research problems. AI is already personalizing learning, accelerating healthcare breakthroughs, and driving productivity. And this is just the start,” said Sarah Friar, the chief financial officer of OpenAI.
The fundraise is coming at a time when OpenAI has been focusing on restructuring to a for-profit organization. Along with removing the not-for-profit tag, the company is also planning to give OpenAI CEO Sam Altman equity in the company. Now, as per Reuters, the OpenAI nonprofit will only have a minority stake in the company.
This comes at a time when several of the top leaders of the company left the company. Some of the recent top-level exits include chief technology officer (CTO) Mira Murati, co-founder of the company John Schulman, senior executive Bob McGrew, and others. On top of that, the company recently highlighted that they will see a $5 billion loss this year on $3.4 billion of annual revenue of the company.
With regards to the funding, as per Reuters, the investors of the recent funding round have also been asked to not invest in a few companies, including those that are the direct rivals of OpenAI. Some of the start-ups where the investors cannot invest include Anthropic and Elon Musk's xAI. However, the request by the AI start-up is not legally binding.