OpenAI has reached an agreement with investors that apparently values the California start-up at $80 billion or more, following a roller-coaster year for the inventor of ChatGPT.
The transaction, revealed by The New York Times but not yet verified by OpenAI, would roughly treble the company’s value in less than ten months.
The anticipated transaction would see the San Francisco-based company sell existing shares to investors led by Thrive Capital.
It would allow executives and staff to sell shares at a much-reduced price, just three months after the company weathered a severe crisis when co-founder and CEO Sam Altman was sacked and then reinstated only days later.
When OpenAI launched its ChatGPT program in late 2022, it sparked an artificial intelligence revolution. The interface’s initial success inspired a surge of interest in cutting-edge technology, which can generate text, sounds, and images on demand.
Microsoft, an existing investor in the start-up, increased its involvement. In recent years, the software giant has invested over $13 billion in Open AI.
It is in stiff competition with Google to create and roll out new tools based on AI’s generative skills, to the point where the US Federal Trade Commission (FTC) initiated an inquiry into Microsoft, Google, and Amazon’s massive investments in specialized start-ups.
OpenAI, which was created as a non-profit in 2015, experienced a serious issue last November. Its board sacked CEO Sam Altman, one of Silicon Valley’s most charismatic leaders, citing a lack of “transparency.”
In the days that followed, Microsoft attempted to hire him, while executives and the vast majority of OpenAI staff requested that those responsible for Altman’s dismissal resign and that he be reinstated. Within a week, Altman was back at work, and several board members quit.
Also Read: OpenAI Employees Plan a Massive Exit to Join Former CEO Altman at Microsoft
