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SoftBank alone has pledged $30bn, taking over from Microsoft as the company’s largest investor.
OpenAI has raised another $40bn – in what is estimated to be the largest private tech funding round ever.
The funding, which was led by the Japanese investment firm SoftBank, takes the nine-year-old start-up to a $300bn post-raise valuation. Microsoft, Thrive Capital, Coatue Management and Altimeter Capital Management also took part in the round. The deal doubles OpenAI’s previous valuation of $157bn from just six months ago.
Bloomberg reported that SoftBank will invest $7.5bn up front, along with “an investor syndicate” which will add $2.5bn. As per the deal, OpenAI will receive the remaining $30bn by the end of the year, which would include $22.5bn from SoftBank and $7.5bn from a syndicate.
With the latest infusion into the start-up, SoftBank has usurped Microsoft as OpenAI’s biggest investor.
Moreover, sources told the financial publication that the new deal stipulates that OpenAI complete its for-profit restructuring quickly. If the restructuring isn’t concluded by the end of 2025, SoftBank would have the option to reduce its total $30bn contribution to $20bn.
According to a statement, the start-up put out yesterday (31 March), the new funding will enable OpenAI to further “push the frontiers of AI research”, scale its compute infrastructure and deliver more powerful tools to the 500m people who use ChatGPT weekly.
The new US administration has loosened government control around artificial intelligence (AI) innovation and growth in the country, prompting many to raise concerns around copyright and AI’s heavy energy consumption.
However, OpenAI, in its proposal for a new AI policy in the US, seeks lesser regulations, while being embroiled in legal battles around similar issues.
In a 2023 lawsuit by the New York Times, the publisher claims that AI models such as ChatGPT have copied and used millions of its published copyrighted works.
OpenAI, which has been at the forefront of generative artificial intelligence, is going through its latest viral moment. Last week, the company released a new image-generation feature which can produce anything from company logos to portraits.
The feature was initially made available to paid subscribers, but has since been rolled out to all free users.
However, while many were raising similar concerns around AI in art, the transformative nature of AI, as well as copyright – OpenAI added 1m new users to ChatGPT in the span of an hour yesterday.
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