OpenAI announced it closed $6.6 billion in funding at a $157 billion post-money valuation. The investors were undisclosed but sources with the company said that the round was led by Thrive Capital. Microsoft, SoftBank, Khosla Ventures, Altimeter Capital, Fidelity, MGX, Tiger Global, and Nvidia also reportedly participated in the round. The $157 billion post-money valuation is reportedly up from $80 billion earlier this year and $29 billion last year. It is believed that some of the investors negotiated options to invest more capital in the company next year at the same valuation.
The company is best known for its ChatGPT product, which grew at a rapid pace and popularized generative artificial intelligence. The growth of generative artificial intelligence also helped drive the rapid increase in demand for Nvidia’s chips.
“Every week, over 250 million people around the world use ChatGPT to enhance their work, creativity, and learning. Across industries, businesses are improving productivity and operations, and developers are leveraging our platform to create a new generation of applications. And we’re only getting started,” said OpenAI in the funding announcement. “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.”
There are reportedly 11 million ChatGPT Plus subscribers and 1 million paid business users on ChatGPT. CNBC’s sources reported that OpenAI saw $300 million in revenue last month – which is up about 1,700% since the start of the year. And the company is reportedly anticipating $11.6 billion in sales for next year – which would be up from $3.7 billion this year. However, the company expects to lose around $5 billion this year.
There are rumors that OpenAI plans to restructure the company as a for-profit business and establish a nonprofit unit as a separate entity. This decision is believed to be in discussions, and no specific figures have been finalized yet. This restructuring would come on the heels of several executive departures, such as Chief Technology Officer Mira Murati.
Along with the funding round, the company has also set up a $4 billion revolving credit line, bringing the total liquidity to over $10 billion. JPMorgan Chase, Citi, Goldman Sachs, Morgan Stanley, Santander, Wells Fargo, SMBC, UBS and HSBC participated in this agreement, according to CNBC. The $4 billion base credit line also features an option to increase by $2 billion more. This loan is unsecured and it can be tapped into over the next three years. OpenAI pointed out that the company plans to use this money to “invest in research and products, expand infrastructure, and attract talent. “
