OpenAI's Stunning $150-B Valuation Hinges On Changing Corporate Structure

OpenAI’s new financing round is expected to take the form of convertible notes, according to sources with direct knowledge of the matter.

The previously unreported details of the $6.5 billion funding round highlight the significant changes OpenAI is making to move away from its roots as a research-based nonprofit. I Photo: ishmael daro Flickr

The company’s valuation, projected to reach $150 billion, will depend on whether the ChatGPT maker can restructure its corporate governance and remove a profit cap for investors, Krystal Hu and Kenrick Cai reported.

The previously unreported details of the $6.5 billion funding round highlight the significant changes OpenAI, the world’s most valuable AI startup, is making to move away from its roots as a research-based nonprofit.

The structural changes are aimed at attracting more investment to fund OpenAI’s costly pursuit of artificial general intelligence (AGI)—AI that surpasses human intelligence.

Investor demand for the sizable funding round has been strong, and sources say the deal could be finalized within the next two weeks, citing OpenAI’s rapid revenue growth.

Existing investors such as Thrive Capital, Khosla Ventures, and Microsoft are expected to participate, along with new investors including Nvidia and Apple. Sequoia Capital is also in talks to return as an investor.

However, if the restructuring is unsuccessful, OpenAI would need to renegotiate its valuation with investors, potentially at a lower figure, according to anonymous sources familiar with the matter.

The removal of the profit cap would require approval from OpenAI’s nonprofit board, which includes CEO Sam Altman, entrepreneur Bret Taylor, and seven other members.