OpenAI raises record USD122b with USD3b from individual investors via banks
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The news: ChatGPT maker OpenAI has closed the largest private funding round in history, raising USD122 billion ($176.8 billion) at a USD852 billion valuation from backers including Amazon, Nvidia and SoftBank.
The still unprofitable AI lab said the capital will support its costly push for chips, data centres and talent as it gears up for a potential IPO.
The context: The round grew from the USD110 billion figure announced in February, with the remaining USD12 billion raised from additional institutional investors and, for the first time, individual investors through bank channels, OpenAI said in a statement.
The round was anchored by Amazon, Nvidia and SoftBank, which committed USD50 billion, USD30 billion and USD30 billion respectively in February, with Microsoft also participating as a long-term partner, the company said.
Other backers include Andreessen Horowitz, DE Shaw Ventures, MGX, TPG, T Rowe Price, Sequoia Capital, BlackRock, Blackstone, Fidelity and Temasek, among others.
For the first time, OpenAI raised USD3 billion from individual investors through bank channels and said its shares will be included in ARK Invest ETFs.
What they said: Chief financial officer Sarah Friar told Bloomberg the deal “blows out of the water even the largest IPO that’s ever been done.” Friar said the deal would give the company “a lot of flexibility” to invest in computing resources and its AI roadmap amid broader public market uncertainty, including from the Iran war.
OpenAI said it generates USD2 billion in monthly revenue, with enterprise sales comprising more than 40% of that figure and on track to reach parity with consumer revenue by end of 2026.
It said its advertising pilot in ChatGPT reached USD100 million in annualised revenue in under six weeks and outlined plans to build a unified superapp bringing together ChatGPT, Codex and browsing into a single agent-first experience.
It comes as the AI startup moves to discontinue its Sora video generator, with CEO Sam Altman reportedly telling employees in a memo the company is now focusing AI agents and a new AI model called Spud.
