OpenAI's potential valuation of half a trillion dollars may rise, as employee shares get sold off
OpenAI, the San Francisco-based AI research company behind the popular ChatGPT, is currently in early-stage negotiations for a secondary stock sale. If successful, the transaction could value the company at approximately $500 billion.
The negotiations are being led by existing investor Thrive Capital, who are interested in purchasing shares from employees. This sale would provide liquidity to current and former employees ahead of a potential future IPO.
The potential valuation increase is a result of rapid revenue growth, projected to reach $20 billion annually by year-end 2025, and surging user numbers for ChatGPT, which now has about 700 million weekly active users. This growth has attracted the attention of global investors, including Japanese tech investor SoftBank, who led a $40 billion funding round for OpenAI earlier this year. However, it's important to note that this funding round is not yet complete.
The secondary sale is significant because it would allow employees to realize substantial returns without the company having to raise new capital or dilute existing shareholders. It also signals continued strong investor confidence in OpenAI amid global competition for AI talent and advancing technology development, including the upcoming GPT-5 model release.
Thrive Capital, an existing investor in OpenAI, approached the company with the idea of a secondary sale. If the sale goes through, it would mark a dramatic boost in OpenAI’s valuation to around $500 billion, underscoring its growth trajectory and positioning the company as the most valuable startup to date. However, it's worth noting that the final valuation will depend on investor demand.
In summary, the secondary stock sale negotiations, if completed, would provide a significant boost to OpenAI’s valuation, offer liquidity to employees, and strengthen the company's position in the competitive AI market. However, the final terms and impact on valuation could still evolve, as the negotiations are ongoing.
The secondary stock sale, led by investing firm Thrive Capital, could significantly increase OpenAI's valuation to around $500 billion, primarily due to its financial growth in business and investing in emerging AI technology. This sale would offer liquidity to employees, signaling continued high investor confidence in OpenAI's future success.
