OpenAI nears new $50 billion funding round in Middle East
finance.yahoo.com
Less than a month after SoftBank completed its $40 billion investment in OpenAI, the tech company is on the hunt for more funds, this time in the Middle East.
CEO Sam Altman reportedly recently visited the United Arab Emirates to speak with sovereign wealth funds in the area, hoping to close a new multibillion-dollar funding round which is expected to total $50 billion or more, which would set a new record for private funding. That would boost the company's valuation to between $750 billion and $830 billion, Bloomberg reports.
The round is expected to close by the end of the first quarter. OpenAI has also reportedly held talks with Amazon.
Should the deal close, this wouldn't be the first time OpenAI has turned to the Middle East for financial help. MGX, an Abu Dhabi-based tech investment firm, has invested in the company previously. And it is in the process of building a large data center in the UAE.
OpenAI last February finalized the $40 billion SoftBank investment, the final installment of which was delivered in late December. At the time, that was the largest private funding round on record. The company also raised $6.6 billion in October via a share sale.
While OpenAI is generally seen as the category leader in the AI space, the company is still not profitable and has been burning through cash at a breathtaking rate. At the same time, it has faced increased competition from Google's Gemini and other AI companies as their chatbots and technologies become more advanced.
To stay atop the field, OpenAI is planning to once again run a commercial during this year's Super Bowl – and the company is said to be about to offer ads on its ChatGPT to advertisers, something Altman has said he has historically been resistant toward.
"Ads plus AI is uniquely unsettling to me," he said at a 2024 Harvard University fireside chat. "When I think of GPT writing me a response, if I had to go figure out exactly how much was [a sponsor] paying … to influence what I'm being shown, I don't think I would like that very much."
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