OpenAI is in early-stage discussions to engage in a secondary stock sale that could lead to a valuation of approximately $500 billion, reflecting strong interest from investors, CNBC reported.
The potential valuation marks a 67% increase from its previous $300 billion assessment. The company is exploring this option to provide employees with liquidity, aligning with the industry trend of using secondary stock sales to reward staff and retain top-tier talent.
Founded in 2015 by key investors Elon Musk and Sam Altman, OpenAI has quickly become a frontrunner in artificial intelligence. The company's chatbot, ChatGPT, is nearing 700 million weekly active users, reflecting growth earlier in the year, according to CNBC.
This growth has fueled interest and confidence in OpenAI's upward trajectory. The discussions around the potential secondary stock sale may involve existing investors like Thrive Capital and Tribe Capital purchasing stock from current and former employees. This aligns with OpenAI's objective to retain its top talent in a competitive market for skilled AI researchers.
The talks could significantly raise OpenAI's valuation, echoing the sector's surging interest and excitement around AI advancements.In April, the firm completed a $40 billion funding round, reportedly oversubscribed by nearly five times, setting OpenAI’s valuation at $300 billion at the time.
Backed by investors like SoftBank and Microsoft Corp., OpenAI emerged as one of the largest private companies globally. OpenAI's annual recurring revenue (ARR) showed strong growth, with projections expecting it to surpass $20 billion by the end of 2023.
Billions in revenue in 2025
The company reported an ARR of $12 billion for the first half of the year, indicating momentum since the $10 billion reported in June.
A $250 billion surge in AI infrastructure spending is anticipated over the coming years, pushing OpenAI and its rivals to aggressively pursue both development and deployment of AI systems.
The developments come amid competition from other tech giants like Meta Platforms and Alphabet, who are also seeking to expand their AI expertise by recruiting top talent. Meta is reportedly recruiting from major companies, including OpenAI, while offering substantial compensation packages.
The Guardian, Asia Economy, and Benzinga also covered the news.