SoftBank plans $500 million investment in ChatGPT creator OpenAI
SoftBank's Vision Fund is planning to drop a hefty $500 million into OpenAI, as per a report by The Information. This investment is part of OpenAI's latest funding round and could give it a serious boost in the start-up world. So far, neither SoftBank nor OpenAI has officially weighed in on this news.
OpenAI's ambitious funding round and potential restructuring
OpenAI is in the midst of raising $6.5 billion through convertible notes, according to a report by Reuters earlier this month. The company is also mulling over a major restructuring that would involve transitioning from a not-for-profit organization to a public benefit corporation. This change is still being discussed, and there's no timeline yet, but if it happens, it could lift the profit cap for investors and possibly boost the company's valuation.
OpenAI's valuation and investor participation
OpenAI is aiming for a valuation of $150 billion in its discussions with various investors to raise $6.5 billion. Thrive Capital is expected to lead this funding round, with Microsoft, OpenAI's largest investor, also participating. However, Apple has reportedly withdrawn from plans to participate in this funding round.
SoftBank's investment in AI sector
This deal will be SoftBank's first investment in OpenAI, which is led by Sam Altman. Back in June, SoftBank had invested in Perplexity AI, an OpenAI competitor. A report from The Information also mentioned that OpenAI is thinking about giving CEO Altman a 7% equity stake as part of its restructuring to turn into a for-profit company.
