The proposed deal, still in early discussions and subject to change, would allow current and former employees to sell a portion of their shares to outside investors in what is known as a secondary sale. Unlike a traditional fundraising round, this type of sale does not involve the issuance of new shares or capital to the company itself, but instead gives liquidity to stakeholders who have been part of OpenAI’s journey from its earlier days.
A spokesperson for OpenAI declined to comment on the matter when reached.
If completed at the proposed valuation, the deal would represent a fivefold increase from OpenAI’s last known valuation of approximately one hundred billion dollars earlier this year. Such a rapid escalation in market value would firmly establish OpenAI as one of the most valuable privately held technology companies in the world, trailing only a few major players like ByteDance, SpaceX, and some of the largest publicly traded technology giants including Alphabet, Microsoft, and Amazon.
Industry observers say that investor demand for a stake in OpenAI remains extraordinarily high, especially in light of the company’s role at the forefront of the artificial intelligence revolution. OpenAI’s flagship product, ChatGPT, has become a household name since its public release, demonstrating unprecedented capabilities in language understanding, reasoning, and content generation. The company’s technology has also been integrated into enterprise workflows, software platforms, and even national infrastructure, making it a critical player in shaping the future of computing.
“This is not just another tech company riding the AI wave,” said an investment analyst familiar with the industry. “OpenAI has positioned itself as the standard bearer for foundation models and large scale generative systems. That is a position many investors believe will deliver exponential returns over the next decade.”
However, some market analysts and financial strategists have expressed caution about such an aggressive valuation. Critics argue that while OpenAI’s growth has been nothing short of remarkable, the landscape of artificial intelligence is still highly dynamic, competitive, and subject to regulatory uncertainty. Other players, including Google’s DeepMind, Anthropic, and Meta AI, continue to pour resources into competing models, raising questions about long term differentiation and market share.
“Five hundred billion dollars is an extraordinary number for a company that is still navigating questions around monetization, intellectual property rights, and government oversight,” said an economist at a leading think tank. “The fundamentals are impressive, but valuations of this scale require not only sustained growth but also a stable and predictable path forward.”
OpenAI operates under a unique governance structure designed to balance its mission driven roots with the realities of capital intensive research. Originally founded as a nonprofit in two thousand fifteen, OpenAI later established a capped profit subsidiary, OpenAI LP, to attract outside investment while still maintaining commitments to safety and alignment in artificial intelligence development. Investors in the capped profit entity have the opportunity to earn returns on their capital, but those returns are limited, after which excess profits are directed toward OpenAI’s nonprofit mission.
CEO Sam Altman has previously stated that OpenAI intends to remain private for the foreseeable future, emphasizing that the company’s goals are aligned with long term benefit rather than short term financial gain. Nonetheless, the secondary share sale under consideration would give employees a chance to realize significant financial rewards for their contributions, and could help attract and retain top talent in an increasingly competitive hiring environment.
According to the source, who requested anonymity due to the private nature of the discussions, several major venture capital firms and sovereign wealth funds have already expressed interest in participating in the proposed transaction. These investors see OpenAI not only as a transformative force in artificial intelligence but also as a strategic asset in global innovation.
While the timing and exact terms of the sale remain undecided, the sheer scale of the valuation has already sent ripples across Silicon Valley and Wall Street. If the deal proceeds as envisioned, it could become one of the largest secondary share sales ever undertaken by a private technology company, signaling a new chapter in the rise of artificial intelligence as a dominant force in the global economy.
source: reuters.com