OpenAI has closed a $6.6 billion funding round that has valued the up-and-coming artificial intelligence company at $157 billion , according to a statement from the company. This news represents a massive figure that nearly doubles the company’s valuation at the beginning of this year.
The $6.6 billion in funding will go toward the company’s AI research, products and services, and computing power, OpenAI said. OpenAI received funding from Thrive, SoftBank, Nvidia and its former backer Microsoft, which contributed just under $1 billion, according to The Wall Street Journal.
The AI company’s new valuation is nearly double what it was in February, at roughly $80 billion, following a deal that allowed employees to sell shares in the company, The New York Times reported. Investors in the funding round can get their investments back if OpenAI, a nonprofit, does not complete its transition to a for-profit company, The Wall Street Journal reported.
OpenAI CEO Sam Altman, who is reportedly set to receive a 7% stake in the company once it becomes a for-profit structure, will potentially see his stake rise to 11% under the new valuation.
As key background, OpenAI has more than quadrupled in value since last year, when its valuation hit $29 billion, according to the Times, which notes that the company has increased its workforce from 1,000 to 1,700 this year. OpenAI is at the forefront of the AI boom and has consistently received backing from other tech giants such as Microsoft, an early investor that has since invested at least $13 billion in OpenAI since 2019.
OpenAI’s conversion from a nonprofit charity to a for-profit company has been closely watched as its offerings and revenue grow. The company expects to generate $3.7 billion in sales this year and about $5 billion in losses, according to the Times. The transition to a for-profit company would potentially attract more investors, the Journal reported, noting that the process could take years to complete.or a for-profit company, according to the Journal.
