OpenAI Eyes $100 Billion Valuation With New Round of Funding

It is reported that OpenAI is in talks for a new round of financing that would value the company at over $100 billion.

Sources familiar with the matter have revealed that OpenAI is negotiating to raise several billion dollars in this new round of financing, with Thrive Capital leading the investment with a $1 billion commitment. As OpenAI's largest shareholder, Microsoft is also said to be participating in this round of financing.

OpenAI's CFO, Sarah Friar, told employees in a memo on Wednesday that the company is seeking new financing, but did not disclose details. Friar stated that the funds raised will be used to support the company's demand for computing power and other operational expenses.

Reports indicate that earlier this year, OpenAI's valuation increased from $29 billion last year to $80 billion. With annual revenue exceeding $2 billion, OpenAI's valuation may have grown by about a quarter within half a year.

This would make OpenAI one of the world's most valuable startups, highlighting the growing demand for generative artificial intelligence software.

OpenAI began to experience growth after launching the ChatGPT chatbot at the end of 2022, and this growth has continued as the company has rolled out products aimed at businesses and expanded into AI-generated photos and videos.

Last week, OpenAI announced the launch of a search engine prototype called SearchGPT, designed to provide users with fast, timely answers and relevant sources. The company promises that users will have the opportunity to search more naturally and intuitively and to ask follow-up questions as if in a conversation.

OpenAI has stated that it plans to integrate this tool into its ChatGPT chatbot, which is currently being tested with a small group of users.

The launch of this tool could impact Google and its dominant search engine. Since the launch of ChatGPT, Alphabet investors have been concerned that OpenAI might take market share from Google by offering a new way for users to search for information online.

Additionally, reports suggest that OpenAI may launch a reasoning AI product called Strawberry as early as this fall. Researchers describe Strawberry as capable of solving mathematical problems it has never seen before, something current chatbots cannot do, and is also trained to solve programming-related issues.