OpenAI raises over $8 billion in latest funding round, reaching $300 billion valuation

Sam Altman-led OpenAI locked in over $8 billion in its latest funding round, pushing its valuation to $300 billion and accelerating its plans to secure $40 billion in total capital this year, The New York Times reported Friday.

In March, OpenAI announced its fundraising plans, with SoftBank pledging up to $30 billion by year-end. The company raised $2.5 billion from venture capital firms that same month and aimed to secure an additional $7.5 billion by the end of the year.

The recent round drew new backers such as Blackstone, TPG, and T. Rowe Price, joining a roster of existing investors including Fidelity Management, Founders Fund, Sequoia Capital, Andreessen Horowitz, Tiger Global, and Thrive Capital, to name a few.

Dragoneer Investment Group led the round with a $2.8 billion investment, representing about 10% of the firm’s funds. The round was five times oversubscribed, with some early investors receiving smaller allocations as OpenAI prioritized new strategic backers.

OpenAI’s annual recurring revenue has reached $13 billion, up from $10 billion in June, with projections to exceed $20 billion by year-end. The ChatGPT maker has expanded its business user base to five million, increasing from three million in recent months.

Blackstone and TPG are expected to help drive the adoption of ChatGPT across their portfolio companies, especially in healthcare, finance, and the industrials.

The funding round comes amid ongoing discussions between OpenAI and Microsoft concerning the company’s transition to a for-profit structure. Microsoft, as OpenAI’s largest investor and business partner, must approve the restructuring plan, which could influence the company’s potential path toward an IPO.