OpenAI, the Microsoft-backed artificial intelligence (AI) company, completed a deal that values the firm at $80 billion or more, according to a new report.
The New York Times reported on Friday, citing people with knowledge of the deal, that OpenAI would sell shares in a tender offer led by venture capital firm Thrive Capital.
Under the deal, employees will be able to cash out their shares in OpenAI rather than a traditional funding round in which the company would sell shares to investors to raise money for the business, the report added.
OpenAI was involved in a similar deal early last year when VC firms Thrive Capital, Sequoia Capital, Andreessen Horowitz and K2 Global bought shares in a tender offer that valued OpenAI at around $29 billion, the Times report noted.
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OpenAI did not immediately respond to a request for comment.
The company has been a driving force in the rise of AI technologies in the public consciousness following its launch of AI-powered chatbot ChatGPT in late 2022.
OpenAI CEO Sam Altman has reportedly been in talks to raise funds for a new chip venture as he looks to increase the world’s capacity to build more high-end chips to power AI tools.
Altman briefly left his role at OpenAI late last year amid what was described as a “breakdown in communication” between him and the company’s nonprofit board in November.
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Microsoft was set to hire Altman and several of his key allies in leadership at OpenAI, with a large number of the company’s employees threatening to resign before the dispute was resolved in a manner that allowed Altman to stay in his role. Under the agreement, all but one of OpenAI’s board members departed and Microsoft will hold a non-voting observer status on the board.
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Since his return, Altman has made the expansion of OpenAI’s board a priority and has been seeking funding for a new AI chip venture.
The Wall Street Journal reported on Thursday that Altman wants to transform semiconductor manufacturing to accelerate AI development through an initiative that could cost $5 trillion to $7 trillion, sources told the outlet.
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The report indicated Altman has met with investors from the United Arab Emirates and the CEO of Softbank, and has also met with chipmakers like Taiwan Semiconductor Manufacturing Co. (TSMC) about the plan. Altman’s fundraising plans aim to address constraints on OpenAI’s growth that include a shortage of AI chips needed to train advanced large language models, like those that power ChatGPT.
Last year, Altman was pitching his AI chip project, code-named Tigris, to investors in the Middle East, according to a report by Bloomberg.
Reuters contributed to this report.