OpenAI is close to securing a record $40 billion in funding, with SoftBank Group Corp. as the main investor. Other investors, like Magnetar Capital, Coatue Management, Founders Fund, and Altimeter Capital Management, are also in talks to join.
If this deal goes through, it will be the largest private investment in AI ever. This follows earlier reports that SoftBank plans to invest $40 billion in OpenAI, which would value the company at $260 billion before the investment.
It is expected to invest $7.5 billion initially, with an extra $2.5 billion from other investors. Later in the year, a second round of funding will add $30 billion, with $22.5 billion from SoftBank and $7.5 billion from the other investors.
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Magnetar Capital, a hedge fund from Evanston, Illinois, is reportedly thinking about investing up to $1 billion. However, OpenAI, Magnetar, and Founders Fund have not commented, and Coatue Management and Altimeter Capital have not responded to questions.
If this funding round happens, it’s value would rise to $300 billion, nearly double its previous value of $157 billion in October 2023.
This would be a big win for OpenAI, which has grown rapidly since launching ChatGPT in late 2022 and continues to attract major investments as AI becomes more important across many industries.
It has already gained recognition in the AI field with ChatGPT and GPT-4. With the new funding, the company will have more resources to speed up research, improve its AI models and stay ahead of competitors like Google DeepMind, Anthropic, and xAI. With SoftBank’s financial support, OpenAI can also strengthen its AI partnerships, especially in Asia, where SoftBank has strong influence.
SoftBank is known for being a major investor in AI infrastructure. Along with investing in OpenAI, it has committed billions to Project Stargate, an AI infrastructure project in Abilene, Texas. This joint venture with OpenAI, Oracle, and MGX aims to expand AI data centers to meet the growing demand for computing power needed by AI systems.
Increased computational power is essential for building more advanced AI, and these investments help drive that progress.
About OpenAI
OpenAI is focused on creating AI that benefits all of humanity. The company is dedicated to developing AI with safety and human needs in mind, prioritizing these goals over profits.
