OpenAI is the world's most valuable private company after private stock sale | TechCrunch
Key Takeaways
- OpenAI's valuation reached a record $500 billion following a $6.6 billion secondary share sale by employees.
- The cash from the sale went directly to current and former employees holding shares, not to OpenAI's corporate funds.
- Major purchasers included SoftBank, Dragoneer Investment Group, Thrive Capital, and T. Rowe Price.
- The sale acts as a powerful retention tool amid competitive pressure, particularly from Meta poaching engineers.
- The high valuation supports OpenAI's ambitious spending plans, including a $300 billion commitment to Oracle Cloud Services.
A recent report indicates that OpenAI's valuation has reached a historic high of $500 billion for a private company, driven by a $6.6 billion sale of shares held by current and former employees. The purchasers included major firms like SoftBank, Dragoneer Investment Group, and Thrive Capital, with the proceeds going directly to the individuals holding the stock rather than bolstering OpenAI's corporate treasury. This transaction is viewed as a key retention strategy, especially as OpenAI faces intense poaching pressure from Meta's revitalized AI division. The high valuation underscores the company's fundraising momentum, which is essential for funding ambitious infrastructure plans, including a multi-year, $300 billion commitment to Oracle Cloud Services. Furthermore, this sale follows recent major developments, such as Nvidia's planned $100 billion investment and ongoing discussions about OpenAI's potential conversion into a for-profit entity, which could face complications if the legal conversion stalls.
