Someone Made A Big Mistake About OpenAI’s $1.5 Trillion Value
OpenAI is in talks for a massive new funding round, but major news outlets cannot agree on the valuation by a margin of $300 billion. That gap reveals just how chaotic the AI money race has become.
Is OpenAI about to raise money at a $1.2 trillion valuation? That’s up from $852 billion in March. The FT reported the figure at $1.2 trillion. So did Bloomberg. The news service wrote, “OpenAI is holding early talks with investors about a fresh funding round that would value the ChatGPT creator at more than $1.2 trillion ahead of an initial public offering.”
But someone thinks the figure is $1.5 trillion. The New York Times says so. It reported its information in an article that said, “The funding round would double the value of the start-up behind ChatGPT and establish it as the world’s most valuable private company.”
Maybe one figure is pre-money. Maybe one is post-money. Or maybe someone just got it wrong. Reports said the talks with big investors are in early stages.
The $300 billion difference is a lot of money. It’s about the same as Procter & Gamble’s (NYSE: PG) market cap.
In some ways, the difference does not matter. It is just one more thing to read about. AI will wipe out millions of jobs. AI will kill everyone in the world. Alternatively, it will allow people to live in leisure and never have to work again.
OpenAI’s revenue run rate is $40 billion a year. It won’t be profitable until 2030. Meanwhile, rival Anthropic’s revenue run rate is $65 billion a year. Some reports say it made money over the last two quarters. Anthropic might raise money, too. That might be at a valuation of $1.2 trillion. Or it may be worth $2 trillion the day it goes public. Bloomberg wrote, “Anthropic’s $2 Trillion IPO Is Still On. And So Is the AI Race.”
Over the last several months, story after story has covered the money raised by smaller AI companies. In many cases, they are barely rumors.
How much is OpenAI worth? There seems to be some confusion.
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
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