OpenAI, the developer of ChatGPT, secured $6.6 billion in its most recent funding round. Key investors, including early supporter Microsoft, are doubling down on their commitment to the rapidly advancing artificial intelligence (AI) sector.
The agreement valued the tech company at $157 billion (£118 billion), placing it on par with Goldman Sachs and surpassing the worth of many major American companies, making it one of the world’s most valuable start-ups.
OpenAI stated that the funding will help it maintain its position at the forefront of AI research. This comes amid heightened attention on the company, partly due to internal leadership conflicts and discussions about its future direction.
CEO Sam Altman is reportedly restructuring OpenAI into a for-profit organization, removing its non-profit board in the process.
Although the company’s shift has attracted investors, it has caused friction with some staff members and critics.
Among the critics is OpenAI co-founder Elon Musk, who left the company in 2018. He has expressed that OpenAI has strayed from its original mission of creating AI for the benefit of humanity.
OpenAI is widely recognized for driving artificial intelligence tools into the mainstream, fueling a surge of investment and interest in the industry.
OpenAI stated, “The new funding will enable us to strengthen our leadership in advanced AI research, expand our computing capacity, and keep developing tools that assist people in tackling complex challenges.”
The latest funding round saw contributions from investors such as Thrive Capital, Japanese technology conglomerate SoftBank, American chip leader Nvidia, and Microsoft, which already holds a significant stake in the company.
According to the deal’s terms, investors have the option to renegotiate or reclaim their funds if the transition to a for-profit structure doesn’t occur within two years. Additionally, it depends on lifting the cap on returns for investors.
Although the valuation revealed on Wednesday may seem elevated by typical standards, “these are not normal times,” remarked Karl Freund, principal analyst at Cambrian AI Research.
“Unless AI somehow fails, which I find hard to believe, OpenAI will emerge as a significant force to contend with.”
OpenAI reported having 250 million weekly active users and one million paying business clients.
The company is expected to achieve $3.6 billion in revenue; however, projected losses exceeding $5 billion are anticipated to surpass that revenue, according to Reuters.
Reports indicate that the pressure to rapidly launch new versions of its popular chatbot has created tension between OpenAI’s research and safety teams and those working on monetizing the company’s products.
Since Mr. Altman’s brief removal as CEO in November, OpenAI has experienced a significant departure of key executives, including former chief scientist Ilya Sutskever.
Last week, the company’s long-serving chief technology officer, Mira Murati, announced her resignation, stating in a statement that she had “made the difficult decision to leave” after considerable contemplation. On the same day as Murati, two leading researchers at OpenAI also revealed their departures.