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OpenAI Nears $100B Funding at $850B Valuation

 

OpenAI is nearing a $100 billion funding deal that could value the AI developer at over $850 billion.

 

 

OpenAI is in advanced discussions to secure a private funding round of more than $100 billion, according to multiple reports citing people familiar with the matter, a deal that would result in a post-money valuation exceeding $850 billion and mark one of the largest capital raises in technology history. The capital raise, led by strategic corporate investors, remains in negotiations and has yet to be formally closed, with allocations expected to be finalised within the month, including reporting from TechCrunch.

 

The prospective funding round comes as the San Francisco-based artificial intelligence company continues to expand its infrastructure, model development and commercialisation of its generative AI products, including ChatGPT. Despite material revenue growth, the company has maintained that it remains unprofitable and is investing heavily in technology, prompting the need for substantial fresh capital. The company operates primarily from San Francisco.

 

The investment discussions occur amid heightened global interest in AI systems and infrastructure, with the company positioned as one of the sector’s most highly valued private companies. The round’s size and valuation would outpace typical venture financings and potentially reshape private capital expectations in tech fundraising.

 

Key Investors and Funding Structure

 

The first phase of the funding round is reportedly dominated by strategic corporate investors, with major technology firms participating in negotiations to provide the bulk of the initial capital. Amazon is reportedly in talks to commit up to $50 billion, SoftBank may contribute around $30 billion, Nvidia could invest close to $20 billion, and Microsoft is expected to participate with a further investment, although the specific amount has not been publicly disclosed.

 

Sources indicate that these investors’ contributions are intended to be paid in installments over the course of the year, rather than in a single lump sum, allowing each participant to pace their capital deployment in line with operational milestones and execution risk assessments. The first tranche of funding is expected to close by the end of February, with terms including strategic collaborations tied to cloud computing infrastructure and AI hardware support.

 

Following completion of the initial phase, a second tranche is planned that would bring in additional financial investors such as venture capital firms and sovereign wealth funds, potentially pushing the total raised beyond the current $100 billion target. However, these later commitments have not yet been finalised and remain subject to ongoing negotiations.

 

The funding round’s structure reflects a phased approach to capital raising that mixes corporate strategic investment with later financial investor participation, a methodology designed to balance operational funding needs with broader market confidence.

 

Valuation Implications and Company Financial Profile

 

If concluded at the terms discussed, the latest funding round would elevate the company’s post-money valuation above $850 billion, exceeding earlier expectations of around $830 billion and reflecting strong investor demand for AI platforms with wide commercial application. The pre-money valuation is reported to remain at approximately $730 billion, meaning the injected capital would account for the valuation increase.

 

The prospective valuation places the company among the most valuable private technology companies globally, surpassing typical venture-backed startups and rivaling established public technology firms in market value. This valuation milestone reflects the premium that backers are placing on advanced AI capabilities and the anticipated commercial scalability of generative AI systems.

 

Despite generating substantial revenue in the recent financial period, the company has continued to operate with significant net losses as it invests in data centre capacity, computing hardware and model development. These ongoing investments contribute to continued reliance on external capital to underwrite near-term costs while supporting large-scale infrastructure expansion.

 

The company’s financial profile and investor commitments have attracted broad attention in financial markets and the technology sector, with discussions emerging about potential paths to liquidity events, including an eventual initial public offering.

 

Competitive and Market Environment

 

The scale of the funding round reflects broader trends in the artificial intelligence industry, where leading developers are pursuing substantial capital to support expansive computing infrastructure and algorithmic advancements. The reported financing efforts occur as rival AI companies, including Anthropic, have also secured significant investments and elevated valuations, contributing to intensified competition for talent, computing resources and enterprise adoption.

 

This has drawn increased scrutiny from market observers and industry analysts regarding the sustainability of high valuations and the pace of AI investment, particularly as companies balance infrastructure costs with commercial revenue expansion. Strategic corporate investors participating in the round may gain deeper integration into AI supply chains, encompassing cloud services, GPU provisioning and distribution channels, further aligning operational interests with platform development.

 

Amid these developments, ongoing industry discourse continues regarding the future shape of AI leadership, regulatory considerations, and the role of private capital in advancing large-scale AI deployment, with the funding round serving as a focal point for broader investment activity across the artificial intelligence ecosystem.

 

Impacts on Sector Investment Practices

 

Should the funding round close at the anticipated scale, it would likely set a new precedent for private capital commitments in the technology sector, particularly for companies operating in emerging infrastructure-intensive domains. Observers have noted that a deal of this magnitude may influence how institutional investors, sovereign capital pools and corporate entities approach long-term technology allocations where computing scale is a primary cost driver.

 

The involvement of major technology firms as lead investors suggests a strategic alignment that extends beyond capital provision to collaborative engagement on technology development, cloud architecture integration and co-innovation on next-generation AI platforms. These dynamics may inform future funding structures for advanced technology companies and reshape expectations for large private financing rounds.

 

Overall, the reported negotiations for a more than $100 billion funding round at a valuation above $850 billion represent a significant development in the technology investment landscape, highlighting the scale of capital flowing into artificial intelligence and the strategic intersections between deep technology development and corporate investment activity.