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OpenAI is looking for a new funding round that could double its value, according to a report

BY THE ARAB TODAY Jan 31, 2025

OpenAI is looking for a new funding round that could double its value, according to a report

OpenAI is looking for a new funding round that could double its value, according to a report

OpenAI, an artificial intelligence startup, is having early talks about raising money that could make it worth $340 billion, says The Wall Street Journal. This would more than double its current value, as it faces competition from the new Chinese AI company, DeepSeek.

Key points

OpenAI is in the early stages of raising up to $40 billion in new funding, according to the Journal. However, the discussions are still ongoing, and the deal could fall through. This funding would make OpenAI worth $340 billion, more than doubling its previous valuation of $157 billion after raising $6.6 billion in October. The Journal also reported that Japanese investment firm SoftBank may lead the funding round and invest between $15 billion and $25 billion. OpenAI has not responded to Forbes’ request for comment.

How does OpenAI compare to its competitors?

OpenAI’s value was $157 billion as of October. Elon Musk’s company, xAI, was valued at around $50 billion last fall. The AI startup Anthropic, backed by Amazon, was valued at $18 billion but is in talks to raise its value to $60 billion. DeepSeek is worth at least $1 billion, though it could be worth more despite having little revenue. While not strictly AI companies, Microsoft and Meta have allocated $80 billion and $65 billion for AI in their current fiscal years, respectively.

Background

OpenAI has the highest valuation of any U.S. AI startup and has more than quadrupled its value from 2023 to 2024. It earned $300 million in revenue in August and expects $3.7 billion in annual sales for 2024. OpenAI is also leading Project Stargate, an AI infrastructure initiative backed by Trump, Oracle, and Nvidia. This project aims to build AI data centers across the country and create hundreds of thousands of American jobs. However, the large funding behind OpenAI and other AI startups has been questioned after Chinese startup DeepSeek gained popularity, claiming it developed an AI model much cheaper than American companies. DeepSeek said it spent $5.6 million on GPUs to train the model, though some experts are skeptical of the figure, saying it doesn’t account for additional costs.

Published: 31th January 2025

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