WASHINGTON, United States / MENA Newswire / – OpenAI has closed $11 billion in new funding, the first part of a round that values the artificial intelligence company at $1.25 trillion. The money reached the company by Friday, November 6, according to people familiar with the deal. SoftBank and Abu Dhabi investment firm MGX took part in the funding, investors said. The amount raised so far is only a portion of the up to $30 billion OpenAI originally targeted. The valuation is also below the level it first sought.
Reports had said OpenAI initially sought a valuation of about $1.4 trillion, while two investors put the first ask at $1.5 trillion. Chief financial officer Sarah Friar said the higher figure had come from a media report rather than from the company. She confirmed the $1.25 trillion figure is a pre-money valuation. The round could grow to as much as $20 billion in the coming weeks. A further tranche of up to $9 billion has yet to close. OpenAI declined to comment on the funding.
The company scaled back its targets amid a selloff in AI stocks on public markets. Investors have voiced concern about the level of infrastructure spending and possible obstacles to data centre construction. The pullback revives questions about valuations that have drawn comparisons between the AI boom and the dot-com bubble. OpenAI had been in talks for more than a month to secure the funding after postponing plans for an initial public offering. The new round still marks a sharp step up from its last valuation.
Valuation up sharply since March
OpenAI raised $122 billion in a funding round in March that valued it at $852 billion. The new $1.25 trillion figure is about 47% higher than that level. Friar described the price as almost 50% above the March valuation. She said demand for AI is real and pointed to rapid growth across the business. According to Friar, the company grew 70% from the previous quarter in the third quarter. Its enterprise business doubled over the same period, she said.
Friar said revenue is now split roughly equally between consumers and businesses. ChatGPT has about 1.2 billion weekly users, she said. The company’s advertising business reached an annual run rate of $1 billion by August. Friar did not give overall revenue figures. OpenAI’s rapid expansion has also brought scrutiny from governments and regulators. Australia this year reviewed its cyber systems after an OpenAI-linked breach involving Medicare data. The company has faced wider questions over data protection and safety.
Investors weigh AI spending plans
The funding comes as investors look more closely at the cost of building AI infrastructure. NVIDIA has said OpenAI’s existing and planned commitments total about 12 gigawatts of its computing capacity. The scale of those commitments has fuelled debate over how quickly AI companies can turn spending into profit. SoftBank has been one of OpenAI’s largest backers. MGX, an Abu Dhabi-based technology investor, has also expanded its stakes in AI companies and data centres.
Rival Anthropic is reportedly preparing a stock market listing in the United States. Some investors have suggested it could be valued at around $1.5 trillion, down from earlier talk of about $2 trillion. OpenAI has not set a timetable for its own listing. Chief executive Sam Altman has said the company is prioritising safety over a rush to go public. The second part of the current funding round is expected to close in the coming weeks.