BUSINESS – OpenAI, the developer behind ChatGPT, has successfully raised $40 billion in a funding round led by SoftBank Group, elevating the company’s valuation to $300 billion. This milestone positions OpenAI alongside ByteDance as the second-highest valued private company globally, trailing only SpaceX.
The initial tranche of $10 billion includes $7.5 billion from SoftBank and $2.5 billion from a consortium of investors such as Microsoft, Coatue Management, Altimeter Capital, and Thrive Capital. An additional $30 billion is slated for disbursement by the end of 2025, contingent upon OpenAI’s transition to a for-profit entity. Failure to meet this condition could result in a reduction of up to $10 billion from the pledged funds.
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The capital infusion is earmarked for advancing artificial intelligence research, expanding computational infrastructure, and supporting projects like “Stargate,” a $500 billion joint venture with SoftBank and Oracle aimed at constructing large-scale AI data centers over the next four years. This funding round coincides with OpenAI’s notable user growth, with ChatGPT now serving 500 million weekly users. The recent introduction of a feature that transforms photos into Studio Ghibli-style illustrations attracted one million new users within an hour of its release.
Despite these advancements, OpenAI faces challenges, including legal disputes over its restructuring plans and the imperative to achieve profitability. The company’s ability to navigate these issues will be critical in maintaining investor confidence and sustaining its trajectory in the AI sector.
