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OpenAI trims funding round to $20B as major investors pull back: Report

OpenAI trims funding round to $20B as major investors pull back: Report

The AI company is seeking fresh capital at a $1.25 trillion valuation after reducing its funding target, with MGX expected to lead the latest round.

by Diego Almada Lopez

2 min read

In AI

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OpenAI has reduced the size of its latest funding round after some of its major backers signaled they would invest less than in previous financings.

The company had initially targeted as much as $30 billion at a valuation of up to $1.5 trillion in September, but has since cut its fundraising target by at least one-third and is now seeking capital at a $1.25 trillion valuation, DealBook reported.

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An investor group from the United Arab Emirates, including MGX, is expected to provide the largest commitment, with an investment in the single-digit billions.

SoftBank, one of OpenAI’s biggest supporters, is in discussions to invest hundreds of millions of dollars, a smaller commitment than its previous contributions. Coatue, another existing investor that has also backed rival Anthropic, has discussed a similar investment.

The company is seeking up to $20 billion through two parts of the round, with the first tranche due to close on Friday. OpenAI expects the overall fundraising to wrap up in the coming weeks.

SoftBank holds an estimated 13% stake in OpenAI after investing nearly $65 billion in the company.

The relationship also extends to infrastructure development through Stargate, the US AI data center project led by SoftBank and OpenAI. SoftBank is responsible for financing, while OpenAI oversees operations.

Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.

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