OpenAI Set to Be Second Most Valuable Startup, After SpaceX

OpenAI is in talks to raise a new round of funding at a valuation of $100 billion or more, which would make it the second most valuable startup in the world after SpaceX.

Bloomberg, which reported the news, cited investors who were part of preliminary discussions about the potential fundraise. However, the fundraise's terms, valuation and timing were not yet set and could change.

Separately, OpenAI is slated to do a tender offer in January, led by Thrive Capital. This offering is oversubscribed, meaning there are more investors than availability of securities.

It is also in talks to raise $8 billion to $10 billion for a new chip venture codenamed 'Tigris' with G42 in Abu Dhabi in the UAE, Bloomberg reported. The goal is to develop AI chips to rival those from market leader Nvidia.

Unknown to most people 14 months ago, OpenAI skyrocketed to fame after the November 2022 release of ChatGPT, which technically is a chat user interface built atop its GPT family of large language models.

But ChatGPT made generative AI's capabilities easily accessible by the masses for the first time. ChatGPT also brought Google, long Silicon Valley's AI leader, out of its slumber to launch a flurry of products including its Bard chatbot, PaLM 2 LLM and the latest, Gemini. ChatGPT also elicited opinions from Nvidia CEO Jensen Huang, among other notables, that a new computing platform has been created.

Related:OpenAI Launches Latest Viral AI Generation Model ChatGPT

OpenAI has raised at least $13 billion from Microsoft and its tech has been incorporated into the software giant's enterprise productivity tools, 365, as well as enhanced cloud capabilities (Azure).

The success of ChatGPT also attracted investor money to budding OpenAI rivals, including Anthropic, which had received billions to date from Amazon, Google and Salesforce, among others.