According to several newspapers today, OpenAI is in talks for a new fundraising round that could value it at more than $100 billion.
ChatGPT’s developers are reportedly looking to raise several billion dollars, according to sources cited by the Wall Street Journal. With a $1 billion contribution, Thrive Capital is expected to lead the fundraising effort. It is expected that Microsoft Corporation will also participate. To date, Microsoft Corporation has contributed $13 billion in financing and cloud infrastructure to OpenAI.
In an internal memo, OpenAI Chief Financial Officer Sarah Friar confirmed the fundraising effort, as reported by Bloomberg. The company plans to execute the tender offer later this year, the CEO continued. Employees of the startup may sell some of their stock in this transaction.
According to reports, the business was valued at $80 billion in a tender offer that Thrive Capital participated in in February. Investors’ excitement about the company’s growth prospects is reflected in what the company expects to earn in its next fundraising round. OpenAI’s annual recurring revenue reportedly surpassed $2 billion in February, less than half a year after crossing the $1 billion milestone.
Friar informed staff members that additional compute capacity would be purchased using a portion of the proceeds from the upcoming round. In March, there were rumors that Microsoft and OpenAI were collaborating to build an AI supercomputer with millions of processors. Considering that premium graphics cards for data centers can cost upwards of $30,000 each, the total system cost can run into the billions of dollars. The corporations have given a code name to the supercomputer Stargate and they want to launch it online after 2028, sources told reports.
A new round of funding could also facilitate OpenAI’s efforts to introduce a successor to the much-discussed GPT-4o model. The company recently revealed that the new model, also known as GPT-5, is being trained.
In July, sources told Reuters that OpenAI was working on a technique known as Strawberry to improve the reasoning power of its LLMs. Neural networks can become more adept at tasks such as generating software code, solving complex math problems, and conducting Internet research thanks to this technology. What features of Strawberry—if any—will make it to GPT-5 is unknown.
OpenAI can explore other tasks that are facilitated by new funding infusions rather than developing new models. Recently, the business began testing SearchGPT, an internally designed search engine that provides natural language answers to user queries. If the multi-billion-dollar investment is made, the corporation will find it easier to finance new market development efforts in addition to its expensive AI development projects.
Ada Spark is a tech explorer and creative content creator with 6+ years of experience. Appreciate teamwork and creative strategies to promote content. Always looking to work according to the latest trends and create content that makes a difference. Also familiar with infographics and other forms of content.
