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OpenAI is nearing the completion of a substantial investment deal with SoftBank, valued at $40 billion, which would establish a pre-money valuation of $260 billion for the AI company, according to sources referenced by CNBC’s David Faber.
The investment is set to be rolled out over the next 12 to 24 months, starting as early as spring. This influx of capital would raise OpenAI’s post-money valuation to approximately $300 billion. Furthermore, SoftBank plans to syndicate up to $10 billion from this amount, enhancing its financial engagement with the AI firm.
If finalized, this investment would make SoftBank the leading investor in OpenAI, surpassing Microsoft’s previous position. The last reported valuation of OpenAI stood at $157 billion from private investors in October.
Initially, forecasts suggested that OpenAI could achieve a valuation of $340 billion following this funding round; however, recent updates indicate a more conservative estimate closer to $300 billion.
A portion of the new funds will be directed towards OpenAI’s commitment to Stargate, a joint venture involving SoftBank, OpenAI, and Oracle, which was introduced by President Donald Trump earlier this year. This initiative aims to channel billions into enhancing AI infrastructure across the United States.
Explore Further on OpenAI’s Developments
OpenAI’s introduction of the ChatGPT chatbot in late 2022 catalyzed a competitive wave in the generative AI space. Since its launch, it has contended with rivals such as Elon Musk’s xAI, Microsoft, Google, Amazon, Meta, and Anthropic. The generative AI sector is anticipated to surpass $1 trillion in revenue by 2032, highlighting its explosive growth potential.
This funding initiative follows SoftBank’s announcement earlier this year of a commitment to invest $3 billion annually in OpenAI technologies, which will also benefit its subsidiaries such as the British chip manufacturer Arm. Additionally, SoftBank and OpenAI have agreed to partner in a new venture aimed at promoting OpenAI’s enterprise solutions in Japan.
In January, OpenAI launched ChatGPT Gov, a specialized AI platform designed for U.S. government use. This platform is marketed as offering enhanced security compared to ChatGPT Enterprise, enabling government entities to incorporate sensitive non-public information into OpenAI’s models while ensuring secure hosting environments.
These strategic moves come as OpenAI and its CEO Sam Altman have appeared to align closely with the Trump administration, evidenced by Altman’s $1 million contribution to Trump’s inauguration and his active participation in corresponding events alongside other tech leaders.
OpenAI’s latest funding discussions occur in the context of increasing competition, exemplified by the rise of Chinese rival DeepSeek. Following the launch of its R1 model, DeepSeek’s app quickly ascended to the top of Apple’s App Store, attracting attention for its cost-effective training model that has outsized implications for U.S. market competitors.
Altman has acknowledged DeepSeek’s R1 as “impressive”, remarking on X that OpenAI intends to produce superior models while expressing enthusiasm for new competition in the arena.
WATCH: Sam Altman: OpenAI has been on the ‘wrong side of history’ post-DeepSeek
This story is still developing, and updates will follow as more information emerges.
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