Generative AI company OpenAI is reportedly considering a secondary share sale to investors at a $500 billion valuation, with current and former employees giving their shares according to multiple sources familiar with the matter, as per a CNBC report.
While the discussions are kept confidential, Bloomberg was the first to report on the talks. Thrive Capital might lead the investing round, according to the sources.
OpenAI to carry out $40 billion funding round
The potential sale comes after the generative AI firm announced it would carry out a $40 billion funding round, which will be led by Softbank Group.
OpenAI has been rolling out multiple features—such as study mode and ChatGPT agent—in a bid to develop the use cases for its technology as tech companies ramp up spending to attract top AI talent who can help them keep pace in the market.
Similar to the majority of AI firms, OpenAI remains a private company and pursues funding instead of a traditional IPO to help raise its valuation and reward employees.
“The steady flow of investments into OpenAI speaks volumes about the markets’ strong appetite and push to support its continued development and its long-term widespread impact and benefit. It also shows that OpenAI’s open access to large-scale strategic investments creates lesser need for an IPO,” said Jadd Elliot Dib, Founder & CEO of Pangaea X