San Francisco: Sam Altman-run OpenAI is reportedly raising funds at a valuation of $80-$90 billion via sale of existing shares.
According to The Wall Street Journal, the ChatGPT developer is “talking to investors about a share sale” that would value the company between $80 billion to $90 billion, “roughly triple its level earlier this year”.
OpenAI generates revenue in part by charging individuals for access to a powerful version of ChatGPT.
“Employees would be allowed to sell their existing shares rather than the company issuing new ones,” said the report.
In April, OpenAI OpenAI closed a more than $300 million share sale at a valuation of $29 billion.
Altman has “privately suggested OpenAI may try to raise as much as $100 billion in the coming years to achieve its aim of developing artificial general intelligence (AGI) that is advanced enough to improve its own capabilities”.
Earlier this year, Microsoft invested around $10 billion in the AI startup. The tech giant owns 49 per cent in OpenAI.
Last month, OpenAI said it expected to reach $1 billion in revenue in 2023.
According to media reports, the ChatGPTmaker OpenAI may even go bankrupt by the end of 2024 if it doesn’t get more funding soon.
A recent report by Investopedia claimed that it is too early for any AI leading company, like OpenAI, Anthropic, or Inflection, to head into the initial public offering (IPO) market.
“It is because it takes at least 10 years of operation and $100 million in revenue for an IPO to be successful,” the report said.