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Microsoft-Backed OpenAI Seals $80 Billion Valuation Deal in Employee Share Cash-Out

San Francisco, February 17, 2024, The Europe Today: Microsoft-backed artificial intelligence powerhouse OpenAI has successfully concluded a deal that places its valuation at a staggering $80 billion or more, according to sources familiar with the matter, as reported by the New York Times on Friday.

The transaction involves the sale of existing shares through a tender offer orchestrated by venture firm Thrive Capital. Notably, this approach allows OpenAI employees to capitalize on the deal by cashing out their shares, presenting a departure from the conventional funding rounds typically pursued to generate capital for business expansion.

This development follows a precedent set early last year when OpenAI engaged in a similar deal. In that instance, venture-capital heavyweights Thrive Capital, Sequoia Capital, Andreessen Horowitz, and K2 Global collectively acquired OpenAI shares through a tender offer, pegging the company’s value at approximately $29 billion.

The introduction of OpenAI’s ChatGPT in late 2022 ignited fervent interest in the AI landscape, prompting various companies to explore innovative applications of this cutting-edge technology.

In parallel efforts, OpenAI CEO Sam Altman has reportedly been engaged in discussions to secure funding for a chip venture. This strategic move aims to bolster the global chip manufacturing capacity, ultimately driving the development of new AI-related tools.

OpenAI’s ongoing initiatives underscore the company’s commitment to pushing the boundaries of artificial intelligence and solidify its position as a pivotal player in the rapidly evolving tech landscape. The $80 billion valuation reflects the immense confidence investors place in OpenAI’s vision and technological prowess, setting the stage for further advancements in the field.