OpenAI is on the verge of securing a groundbreaking $40 billion (approximately Rs. 3,43,265 crore) funding round, spearheaded by SoftBank Group. If finalized, this would mark the largest fundraising event in history, according to sources familiar with the matter. Investors currently in discussions to participate include Magnetar Capital, Coatue Management, Founders Fund, and Altimeter Capital Management, as reported by Bloomberg.
Magnetar Capital, an Illinois-based hedge fund, is expected to contribute up to $1 billion (approximately Rs. 8,581 crore) to the funding round. This monumental investment would propel OpenAI’s valuation to an estimated $300 billion (approximately Rs. 25,74,492 crore), nearly doubling its previous valuation of $157 billion (approximately Rs. 13,47,177 crore) attained in October. According to research firm PitchBook, this would represent the largest funding round ever conducted by a private company.
SoftBank’s Investment Strategy
As part of the deal, SoftBank plans an initial investment of $7.5 billion (approximately Rs. 64,354 crore), with an additional $2.5 billion (approximately Rs. 21,451 crore) being contributed by a syndicate of investors. A second tranche of $30 billion (approximately Rs. 2,57,430 crore) is anticipated later in the year, with SoftBank expected to contribute $22.5 billion (approximately Rs. 1,93,069 crore), while the remaining $7.5 billion will come from the investor group.
However, this ambitious investment plan has triggered financial concerns, causing SoftBank shares to drop by as much as 4.7% in Tokyo trading. Additionally, the company’s credit default swaps widened, signaling investor apprehension about its financial exposure.
OpenAI’s Growth Trajectory
OpenAI continues to experience exponential growth, driven by the widespread adoption of artificial intelligence technologies across industries. The San Francisco-based company is expected to more than triple its revenue to $12.7 billion (approximately Rs. 1,08,965 crore) in 2025, primarily fueled by its paid AI software offerings.
In 2024, OpenAI generated an estimated $3.7 billion (approximately Rs. 31,745 crore) in revenue. Projections indicate that the company’s sales will more than double to $29.4 billion (approximately Rs. 2,52,250 crore) by 2026. Despite these impressive revenue forecasts, OpenAI is not anticipated to achieve positive cash flow until 2029, when it expects revenue to exceed $125 billion (approximately Rs. 10,72,562 crore).
SoftBank’s Aggressive Push into AI
The deal underscores SoftBank’s strategic focus on artificial intelligence, reinforcing its commitment to the sector through large-scale investments. The company has already allocated billions towards the Stargate Project, a Texas-based AI infrastructure joint venture involving OpenAI, Oracle, and MGX.
With this massive funding round, OpenAI is well-positioned to accelerate its AI research and deployment, solidifying its status as a global leader in the field. The partnership with SoftBank and other key investors is expected to drive further advancements in AI technology, shaping the future of innovation in the sector.
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