The funding has attracted returning venture capital investors, including prosperous capital and Khosla Ventures, as well as OpenAI’s largest corporate backer, Microsoft, and new participation from Nvidia.
The closing of the funds coincides with the company’s ongoing restructuring efforts and executive changes, including the abrupt departure of its former chief technology officer, Mira Murati, last week.
Also participating in the round were Altimeter Capital, Fidelity, SoftBank and Abu Dhabi state investment firm MGX.
The financing came in the form of convertible notes and is contingent on a successful structural change to a for-profit organization that would no longer be controlled by the nonprofit board and the removal of the yield cap for investors.
The personnel changes have not deterred the enthusiasm of most investors, who anticipate significant growth based on projections from OpenAI CEO Sam Altman and CFO Sarah Friar.
Discover the stories of your interest
The company is on track to generate $3.6 billion in revenue this year with growing losses of more than $5 billion. It projects a significant increase in revenue next year to $11.6 billion, according to sources familiar with the figures. Investors have also gained some protections as OpenAI goes through the complex corporate restructuring that would provide capital to Altman. Talks are still ongoing and a timeline has not yet been determined.
Investors have negotiated terms that would allow them to recover their capital or renegotiate the valuation if changes are not implemented within two years, the sources said.
OpenAI’s meteoric rise in terms of popularity and product valuation has captured the world’s imagination. Since the launch of ChatGPT, it has attracted 250 million weekly active users. The company’s valuation has also risen from $14 billion in 2021 to $157 billion as it grew revenue from zero to $3.6 billion, far exceeding Altman’s own projections at the time.
The company has told investors that it is still actively pursuing artificial general intelligence (AGI), that is, the development of artificial intelligence systems that surpass human intelligence, as it ramps up commercialization and tries to become profitable.
Disclaimer:
The information contained in this post is for general information purposes only. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the post for any purpose.
We respect the intellectual property rights of content creators. If you are the owner of any material featured on our website and have concerns about its use, please contact us. We are committed to addressing any copyright issues promptly and will remove any material within 2 days of receiving a request from the rightful owner.