SoftBank leads record $63b OpenAI raise
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The news: OpenAI finalised a USD40 billion ($63 billion) funding round led by SoftBank Group, valuing the ChatGPT developer at USD300 billion including the new capital.
The deal, the largest of its kind, will support OpenAI’s expansion of computational infrastructure, AI research and product development, the company said.
The numbers: SoftBank will contribute USD10 billion in April, financed through loans from Mizuho Bank and other institutions, with a further USD30 billion to be invested by the end of 2025.
The second tranche is contingent on OpenAI completing a corporate restructuring to give its for-profit arm independence from the nonprofit entity that currently governs it.
If the restructuring is not completed by the end of the year, SoftBank’s contribution could fall to USD20 billion.
Other participants in the round reportedly include Microsoft, Coatue Management, Altimeter Capital, Thrive Capital and potentially Magnetar Capital.
SoftBank plans to syndicate out a portion of its stake to co-investors.
The context: The deal is the largest-ever investment in a startup and deepens SoftBank’s ties to AI. It follows its earlier losses in tech ventures.
SoftBank’s investment deepens its commitment to artificial intelligence and builds on its partnership with OpenAI and Oracle to launch the USD500 billion Stargate data centre project in the United States.
OpenAI expects to more than triple its revenue to USD12.7 billion this year, driven by strong demand from consumers and enterprises, Bloomberg reported citing an unnamed source.
The company has one million paid corporate users and 500 million weekly users of ChatGPT.
The announcement came just as a viral Ghibli-style image-generation feature drove a record spike in ChatGPT usage. The new tool, released last week, helped it add one million users in an hour, causing outages and slowdowns.
Legal experts flagged copyright concerns over mimicking the style of the famous animation outfit, Studio Ghibli, founded by renowned director Hayao Miyazaki, known for films like Spirited Away.
