OpenAI has closed the largest venture capital round ever, raising $6.6 billion in a funding round led by Thrive Capital. With this deal, OpenAI has raised a total of $17.9 billion in investment, valuing the business at $157 billion. In addition to SoftBank, Khosla Ventures, Microsoft, and Nvidia are also involved in the investment. Microsoft provided over $1 billion, SoftBank funded $500 million, Nvidia invested $100 million, and Thrive contributed $1.3 billion with the potential to add another $1 billion by 2025.
The funds will support OpenAI’s efforts to improve AI research, grow its computing infrastructure, and provide more sophisticated user tools. xAI and Anthropic are two rival firms, but sources claim investors have agreed not to support them. With $7 billion already spent on training and $1.5 billion on staffing, OpenAI is devoting a substantial amount of resources to the development and application of AI models. Interestingly, it is believed that the daily costs of ChatGPT alone total $700,000.
With more than 250 million users on ChatGPT, OpenAI is predicted to generate more than $3.4 billion in income annually this year. Competition continues to grow even though ChatGPT leads in generative AI. Advanced video generating models have been offered by competitors like Runway and Luma Labs, while AI breakthroughs are being pushed by organizations like Google, xAI, and Anthropic.
OpenAI might drop nonprofit governance as part of its future plan, giving it more freedom to raise money. Pursuing long-term investments, like AI chips, and securing alliances with data suppliers like Reddit may need such a step. In addition, the company is dealing with internal issues since a number of its top executives have lately left, casting doubt on the company’s future.