OpenAI breaks record!

After weeks of speculation, OpenAI has officially secured $6.6B from investors, closing the biggest VC funding round ever seen—taking the total amount raised, since its inception, to $17.9B (more than Zimbabwe spent last year)—trumping Elon Musk’s xAI round, which raised $6B at just a $24B valuation.

The round valued the company at $157B, 40 times its reported revenue, and will allow it to “double down on our leadership in frontier AI research, increase compute capacity, and continue building tools that help people solve hard problems."  

As expected, Thrive Capital led the investment, contributing $1.3B, and securing special terms which allow it to invest up to $1B more, next year, at the same valuation, providing OpenAI hit revenue targets. Other key investors were, also as expected, NVIDIA (pledged $100M), Microsoft (less than $1B), Softbank ($500M), Khosla Ventures, Altimeter Capital, Fidelity, and MGX.

But investors can get their money back or re-negotiate terms if OpenAI fails to fulfill its promise to restructure from a not-for-profit to a for-profit within two years and remove the revenue cap, which is set to 100x the initial investment.