Tech & AI
OpenAI nears funding round of up to $30 billion at a $1.25 trillion valuation, led by UAE investors and Coatue
The ChatGPT maker is pitching the round as a bridge to a possible 2027 listing, at a lower valuation than the figure reported earlier in the week.
HedgeWeekly Tech & AI Desk ·
OpenAI is close to completing a funding round of up to $30 billion that would value the company at $1.25 trillion before the new money comes in, CNBC reported on October 22, citing people familiar with the talks. Investors from the United Arab Emirates and investment firm Coatue are leading the deal, and OpenAI has told investors it wants signatures by the end of next week. The final size of the round is still being set.
The $1.25 trillion figure is a so-called pre-money valuation, meaning it excludes the cash being raised. It is lower than the more than $1.4 trillion that Reuters said on October 19 the company could reach in what it called an unusually fast fundraising. In March, OpenAI raised $122 billion at a valuation of $852 billion including that cash.
According to the CNBC report, OpenAI describes the money as an opportunistic bridge ahead of a possible stock market listing, and finance chief Sarah Friar has told staff an IPO could happen in 2027. OpenAI is also negotiating a separate commercial deal for more computing capacity from the UAE. The Financial Times reported earlier this month that OpenAI's annualised revenue was approaching $50 billion at the end of September.
Why it matters: the round sets a fresh private-market price for the biggest AI developer just as rival Anthropic prepares a listing that Reuters says could seek a valuation of up to $2 trillion, with some investors pushing for nearer $1.5 trillion. The lower OpenAI figure lands in a week when the Nasdaq Composite fell 2.6% on October 22 amid doubts about AI spending. Investors in OpenAI's suppliers and cloud partners will watch whether the round closes on time and at full size, as a gauge of appetite for funding AI at these valuations.