According to the New York Times, OpenAI, a Microsoft-backed artificial intelligence company, has agreed to a deal worth more than $80 billion. The transaction includes a tender offer conducted by Thrive Capital, a venture firm, in which existing OpenAI shareholders can sell their shares. According to the report, this would allow employees to cash out their shares rather than generate funds for the company through traditional investment rounds.
This is not the first time OpenAI has made such a deal. In early 2023, the company accepted a similar tender offer from four venture capital firms: Thrive Capital, Sequoia Capital, Andreessen Horowitz and K2 Global. According to the article, the acquisition valued OpenAI at approximately $29 billion. OpenAI has also attracted multiple big investments, including $10 billion from Microsoft in January 2023, as well as funding in 2019 and 2021.
OpenAI has been at the vanguard of AI innovation, creating a lot of buzz around its products
OpenAI has been at the vanguard of AI innovation, creating a lot of buzz around its products. One of its most popular products is ChatGPT, an AI tool that can communicate with users. ChatGPT was launched in late 2022, and it has inspired numerous organizations to use AI technology for their own reasons. Microsoft, for example, has integrated AI into its Bing search engine and continues to build its own AI offerings.
On Thursday, OpenAI announced a new product called Sora, which can create videos from text inputs. The day before, it said that it was testing a deeper memory feature for ChatGPT, which would enable it to recall more of its previous conversations with users. Sam Altman, the CEO of OpenAI, has also been looking for ways to enhance the company’s AI capabilities. He has reportedly been in discussions to buy a chip maker or to secure more access to the costly AI chips that power its products.
The agreement follows a brief crisis in the company in late 2023, when Altman was removed by the board of directors but later returned following employee outrage. In early January, authorities from the European Commission stated that they would investigate whether Microsoft’s support for OpenAI raises any competition concerns. On January 24, the US Federal Trade Commission announced that it was investigating whether Microsoft, Google, and Amazon’s investments in AI startups, including OpenAI, were damaging to competition.
