ChatGPT Creator OpenAI in Talks for $29 Billion Value
The Wall Street Journal reported on Thursday that OpenAI, the artificial intelligence lab behind the ChatGPT chatbot and the Dall-E image generator, is in talks to sell shares in a tender offer valuing the company at about $29 billion, citing people familiar with the matter. According to the Journal, at least $300 million would be raised through the sale of shares by existing investors like employees, as well as investments from venture capital firms Thrive Capital and Founders Fund.
A tender offer in 2021 would almost double the company’s valuation, making it one of the most valuable US startups on paper despite having low revenue. OpenAI’s current backers are Microsoft Corp., which has put $1 billion into the project. Reuters reported last month that OpenAI expects to earn $200 million this year and $1 billion annually by 2024 and that its current valuation is $20 billion.
Elon Musk, an investor and entrepreneur worth a billion dollars, and Sam Altman, an investor from Silicon Valley, founded the company. For example, a source said this week that Microsoft is planning to integrate ChatGPT into its Bing search engine in an effort to steal customers away from Google by providing more natural-sounding responses to users’ queries. OpenAI’s chatbot is an application that can simulate human conversation in response to user requests. It can answer a wide range of questions in a way that is eerily similar to how a person would.
As part of its pitch to investors, the company stated that it anticipates revenue of $200 million in 2019 and $1 billion in 2024. Microsoft Corp. put $1 billion into OpenAI in 2019. A report in The Information on Tuesday said that the company was working on a version of its search engine Bing that uses the AI behind the now-viral ChatGPT. OpenAI, a San Francisco-based AI startup, received $1 billion in funding from Microsoft in 2019. The two companies had made a multi-year deal to work together to make AI supercomputing technologies based on Azure. On November 30, 2022, OpenAI released its newest chatbot, ChatGPT, for public testing at no cost. The chatbot is an artificial intelligence program that can hold natural-sounding conversations with its users by mimicking their words and tone.