OpenAI has closed a massive $6.6 billion funding round that values the generative artificial intelligence giant at $157 billion.
The company announced the news in a blog post Wednesday, writing that “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.”
The round was led by Joshua Kushner’s Thrive Capital, and also includes Microsoft, Nvidia, SoftBank, Fidelity and other high-profile investors.
In a rare move, the outfit asked investors to avoid backing rival start-ups such as Anthropic and Elon Musk’s xAI, the Financial Times reported. It’s worth noting that OpenAI’s latest funding round just barely surpasses xAI, which raised $6 billion in May.
Breaking News: OpenAI, the creator of ChatGPT, has successfully raised $6.6 billion, reaching an impressive valuation of $157 billion!
This funding marks a significant milestone in the AI landscape and positions OpenAI as a leader in technological advancement.
Stay tuned… pic.twitter.com/I94NM5c7mf
— Future_Tech_AI (@Future_Tech_AI) October 2, 2024
The funding round values OpenAI at roughly 40 times its reported revenue, an unprecedented figure that highlights just how much hype surrounds AI in Silicon Valley. The New York Times reported that OpenAI’s monthly revenue hit $300 million in August, and the company expects about $3.7 billion in annual sales this year (and estimates that its revenue will reach $11.6 billion next year.)
OpenAI is arguably one of the most significant Artificial Intelligence companies, Its ChatGPT product changed the conversation around generative AI, and its Dall-E image generation software demonstrated the potential for that in technology. It is also wading into the AI-generated video world with its Sora product, announced earlier this year.
The startup, led by CEO Sam Altman, has in recent months cut a flurry of deals with publishers in preparation for its SearchGPT product, with Time, Condé Nast, and News Corp. among those taking a check.
OpenAI also announced a deal with Apple to bring ChatGPT to its Siri voice assistant in new iPhones.
However, OpenAI, like other AI firms, is in murky legal water, facing lawsuits from authors and others who argue that the training data used to form its models was illicitly or inappropriately obtained, and that the creators of the data should be compensated.
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