OpenAI has completed a secondary share sale led by venture capital firm Thrive Capital, tripling its valuation from just 10 months ago to a whopping $80 billion or more.
Citing unnamed sources familiar with the tender offer deal, The New York Times reported that employees and early backers will be able to cash out portions of their equity in the company. This latest windfall vaults OpenAI into the upper echelons of the world's most valuable private technology firms, behind only ByteDance and SpaceX according to CB Insights data.
The tender offer comes on the heels of a rollercoaster year for the AI trailblazer. In November, OpenAI's board abruptly fired CEO Sam Altman over concerns about his leadership, triggering threats of mass resignation and throwing the company's future into uncertainty. Altman was soon reinstated after an ugly public skirmish, but the drama underscored growing pains as OpenAI rapidly scaled on the back of smash hits like the conversational bot ChatGPT.
Yet despite this chaos, investors remain extremely bullish on OpenAI's generative AI capabilities. The $80 billion private market value positions OpenAI to command nosebleed valuations should it ever pursue an IPO, which CEO Altman claims is not on the horizon. Backers like Microsoft - who has invested $13 billion in OpenAI to date - are likely salivating over future profit potential as AI permeates everything from search engines to creative workflows.
Earlier this week, the company previewed its impressive upcoming text-to-video model Sora to much fanfare.
Chris McKay
For employees and early shareholders, the Thrive Capital tender offer represents a chance to realize some gains from OpenAI's meteoric rise over the past year. And with leading AI firms like Anthropic also achieving sky-high valuations, the AI gold rush shows no signs of slowing down anytime soon.