ChatGPT maker OpenAI’s value has soared to a sky-high $500 billion following a secondary sale of its shares held by current and former employees.
Reuters reported Thursday that the group of employees unloaded around $6.6 billion in shares in the deal, pushing OpenAI’s valuation well north of its current valuation of $300 billion.
During the secondary sale’s open window, OpenAI shareholders offloaded their stock to an investor group that included SoftBank, Thrive Capital, T. Rowe Price, Dragoneer Investment Group, and Emirati state-owned AI investment firm MGX, according to a source who described the deal’s details to Reuters.
While $6.6 billion in shares changed hands during the secondary market sale, OpenAI reportedly authorized the sale of more than $10 billion in stock. The discrepancy suggests that plenty of shareholders are confident holding onto their shares and opted not to sell. CNBC and Bloomberg reported rumors of an upcoming sale in August, noting that the talks were then in early stages but an OpenAI secondary sale could value the company at $500 billion.
Exponential growth, exponential change
OpenAI’s trajectory has been uniquely stratospheric since it first launched ChatGPT in 2022 – just three years ago. In March, OpenAI raised a $40 billion round, led by Japanese investment firm SoftBank, which was joined by Microsoft, Altimeter, Coatue and Thrive Capital. In the six months since, the company has already tacked on an additional $200 billion to its valuation.
With its new valuation, OpenAI easily eclipses SpaceX’s $400 billion valuation and takes the lead as the world’s most valuable private company. The secondary sale comes as OpenAI navigates a plan to restructure itself as a for-profit company, moving away from its unusual and complex structure which sees the company managed by a nonprofit parent company.
OpenAI wants to evolve into a public benefit corporation (PBC), a for-profit company that answers to shareholders while orienting itself toward a stated mission, ostensibly one that benefits society. The shift has caused friction with Microsoft, OpenAI’s largest investor, and could eventually clear the way for OpenAI to become a publicly traded company.
Even as it moves toward remaking its corporate structure, OpenAI continues to release new products with unprecedented societal implications at a breakneck pace. Just this week, OpenAI unveiled an app called Sora. Powered by its text-to-video generator Sora 2, the app invites users to “upload yourself” with a short audio and video sample and drop their own likeness into uncannily realistic AI-generated deepfakes. The result is a kind of synthetic TikTok stocked with AI shorts – a novelty to be sure, but, like an AI-generated short story, one that offers little compelling reason to stick around to see what happens.
Hours after launching, social media channels were awash in the hyper-realistic short videos, many of them depicting OpenAI’s Sam Altman himself being chased by stampeding animals, swirling around a toilet Skibidi-style or shoplifting GPUs from Target. Like OpenAI’s other innovations, Sora’s synthetic videos are nearly indistinguishable from real, human-made media, and the $500 billion company is yet again poised to wholly upend the way that people make sense – or don’t – of what they see online.