OpenAI's valuation reaches $157B

After its latest funding round, at $157bn OpenAI is now valued at roughly the same as Uber, or Goldman Sachs. If it was British, there'd only be five more valuable companies in the country, in France only three, in Germany maybe only two. The numbers can wash over us, but a $6.6bn funding round is astonishing. Backers include traditional VCs, investment companies backed by sovereign wealth funds, and corporates. One of the participants in the latest funding round is Nividia, perhaps the only investor which can hope to see an immediate return. OpenAI has already announced a plan to restructure to become a for-profit business. Given the reported $5bn loss the company is heading for this year, that goal seems a long way off. Watching OpenAI's journey over the coming years will be fascinating. It'll no doubt be a movie before long. https://lnkd.in/ghspj2WW

If AI is indeed a bubble, we will find out soon. OpenAI has recently secured a $6.6 billion in VC funding, pushing its valuation to an unprecedented $157 billion—the largest venture capital deal in history. To put this into perspective, Pfizer is valued at $150 billion, Ford at $41 billion, and Coca-Cola at $240 billion. Since its launch nearly two years ago, ChatGPT has rapidly become a household name, boasting 250 million weekly users. Meanwhile, Meta reported last week that 500 million people are engaging with its Meta AI at least once a month, highlighting the large captive markets ripe for competitors. As we witness these astronomical valuations and user numbers, we must ask: Are we on the brink of an AI revolution, or is this the calm before the storm? #AI #OpenAI

This is total insanity. There is no rational analysis that supports this kind of valuation or investment.

How does this math even add up?? Top 10 $1B+ AI equity rounds JUST this year: xAI — $6B Series B (May 2024) Anthropic — $2.75B Series D (March 2024)? G42 — $1.5B corporate minority (April 2024) Anduril — $1.5B Series F (August 2024) CoreWeave — $1.1B Series C (May 2024) Wayve — $1.05B Series C (May 2024) Moonshot AI — $1B Series B (February 2024) Scale — $1B Series B (May 2024) Safe SuperIntelligence (SSI) - $1B (10 employees and was founded 3 months ago) and now OpenAI $6.6B on the condition they restructure to a for profit, key members responsible for the tech implementation left, $B in loss .....

The biggest funding deal yet is official. OpenAI has raised $6.6 billion at a $157 billion valuation. For context, Spotify has a $75 billion market cap, Airbnb has an $80 billion market cap, and Uber has a $153 billion market cap. So, OpenAI has been valued at something like Spotify plus Airbnb, or just a few billion more than Uber. The public market aside, OpenAI is the third-highest valued startup, behind ByteDance ($225 billion) and SpaceX ($200 billion): https://lnkd.in/g2jFGHbE Still, don’t call this a VC deal. Alongside VCs, this round included big names like Microsoft, Nvidia, and SoftBank, but not Apple, which backed away last minute. Also, OpenAI reportedly asked investors to avoid backing rival startups such as Anthropic and xAI: https://lnkd.in/g2TcPHdk In other words, the startup made an exclusive funding arrangement to keep its early lead in generative AI. Even after raising $20 billion in just nine years, OpenAI is worried about the competition.

OpenAI has now raised more than $20 billion with a fresh megaround led by Thrive Capital. Existing investor Microsoft also reportedly joined the new $6.5 billion round, while Apple dropped out. Here's what we know and how other Bay Area AI companies stack up.

When does CLOSING a funding say more about the company and less about the money? Now??with OpenAI. Opinion: ?????AI raised $6.6 billion from investors at a post-money valuation of $157 billion. ??This cements their status as one of the most valuable private companies in the world that is operating at a recurring revenue loss. ??The funding attracted returning venture capital investors including Thrive Capital and Khosla Ventures, as well as ???AI's biggest corporate backer Microsoft (MSFT.O), and new participation from Nvidia (NVDA.O). ??The closing of the funds coincides with the company's ongoing restructuring efforts and executive changes from not for profit to a for profit company- including the abrupt departure of its longtime Chief Technology Officer, Mira Murati, last week…before she had to certify anything in the Representations and Warranties as the CTO. ??The funding came in the form of convertible notes, which have not been seen much in a decade or so - most investments are done with a S.A.F.E. Note- or a convertible note where the debt elements have been eliminated. ??Based upon early reports, the Notes are tied to a successful structural change into a for-profit that would no longer be controlled by the non-profit board and the removal of cap on returns for investors. ??The personnel changes have not changed or deterred enthusiasm from most investors, who anticipate significant growth based on the projections by ???AI CEO Sam Altman and CFO Sarah Friar. That logic is hard to follow. ??The Company is “on pace” to generate $3.6 billion in revenue this year on mounting losses of over $5 billion ??Despite having a recurring big overall revenue loss, and losing the staff that was in charge for designing and implementing the actual product, ???AI projects a major revenue jump next year to $11.6 billion. The HOW has not been provided? ??Investors have also secured some protections as ???AI undergoes the complex corporate restructuring that would grant Altman equity. The talks are still ongoing, and no timeline has been determined yet. ??The funding without structure or defined ownership is another thing the strikes one as odd. ??This is getting more interesting. Perhaps there is something else missing from the latest in Silicon Valley??? What do you think????? ??♀?I am Julie Saslow Schroeder, a GC/CLO specializing in helping companies and in-house teams manage risk, governance, and the business impact of emerging technologies for two decades. Let’s connect if you face these challenges #corporatelaw #legalcounsel #riskmanagement #governance #Future #management #inhousecounsel #cloud #motivation #artificialIntelligence #DataPrivacy #SaaS #bigtech #AI #TechEthics #microsoft #OpenAI #TechInvestments #ChatGPT #CloudComputing #deals #entrepreneurial #DataProtection #BigData #DataScience #StartUp #tecnologia #future #lossleader #socialmedia #innovation #technology Harvey How Women Lead How Women Invest #economics #innovation

Well, there it is. OpenAI is now worth <checks notes> 157 BILLION DOLLARS ?! They just confirmed a raise of 6.65b in new money to take on AGI... The company confirmed in a blog post that it's closed its massive round of new investment without specific details to who joined the round. It's likely (as rumored) the usual suspects including Softbank which supposedly dropped a ton in. Why do they need so much money? Well, frontier AI models aren't cheap to build & while o1-preview (their new model) is out to us, o2 and maybe even o3 are in the mix under the radar. Each of those are a massive & expensive undertaking at exponential scale in terms of compute. The overall business use cases are still somewhat unproven but we expect OAI to be leading this race for sometime to come. However, and this might sounds insane, but $6b isn't *that* much money when you compare to whom this not-so-little start-up is against (Google, Amazon, Meta). How quickly will they blow through this? Hard to say. They're still losing a ton of money and prob need to get to break-even somewhat soon. More on the pod this week! #openai #venturecapital #investment #samaltman #chatGPT

OpenAI just closed a funding round at $157B. Shot out to the Googlers that left Google when the getting was good and now are seeing their equity packages double, triple, quadruple at OpenAI. We'll talk more about this on today's bonus episode - https://bit.ly/3ZzKUXD.