OpenAI Nears $100B DealValuing Company Over $850B

OpenAI is reportedly finalizing an agreement to secure over $100 billion in new fundingpotentially pushing its valuation beyond $850 billionaccording to sources cited by Bloomberg.

This significant capital infusion comes as the creator of ChatGPT navigates substantial cash expenditures on its path to achieving profitability. In a strategic move to boost revenueOpenAI has announced plans to introduce advertisements within ChatGPT for its free user base. This initiative represents a calculated riskwith the potential to either significantly increase income orconverselylead to a decline in user engagement.

Evidentlyinvestors perceive this venture as worthwhilegiven that the prospective valuation now surpasses initial expectations of $830 billion by $20 billion. Bloomberg's sources also indicate that the company's pre-money valuation is set to remain at $730 billion.

The initial segments of this funding round are reportedly attracting contributions from prominent industry playersincluding Amazonwhich is already in discussions to invest up to $50 billion; SoftBankpreparing for a $30 billion commitment; Nvidianearing a $20 billion investment; and Microsoft. Venture capital firms and sovereign wealth funds are anticipated to finalize their contributions at a later stagewhich could further elevate the total capital raised.