OpenAI raises $100 billion to start production of its AI chip
December 24, 2023

OpenAI raises $100 billion to start production of its AI chip

OpenAIthe company behind the popular chat ChatGPTis currently in early talks to raise at least $100 billion in new funding, according to sources familiar with the situation.

Potential investors are involved in preliminary talks, but the terms, valuation and timing of the transaction have not yet been finalized and could change, the sources said.

This artificial intelligence company, which has raised $13 billion so far by Microsoft and others, is also reportedly in talks to raise funds for a new chip-making project with Abu Dhabi-based G42, which has expertise in artificial intelligence hardware and software. Bloomberg. Sam Altman, CEO of OpenAI, is seeking capital for the company's chip project, which aims to create specialized chips for artificial intelligence applications.

OpenAI is one of the most valuable startups in the US, second only to Elon Musk's SpaceX

OpenAI's rising valuation reflects the artificial intelligence craze that was sparked more than a year ago by the launch of ChatGPT, a chat that can generate realistic and creative text based on simple queries. Chat became a sensation in Silicon Valley and beyond, demonstrating the potential of artificial intelligence to transform various fields. According to CBInsights, OpenAI is one of the most valuable startups in the US, second only to SpaceX Elon Musk. OpenAI declined to comment on the funding negotiations.

Industry artificial intelligence saw a sharp increase in investment by large tech companies and sovereign wealth funds in 2023. Among them, and Alphabet backed OpenAI rival Anthropic with billions of dollars. Salesforce led the funding round for Hugging Face, valuing the AI ​​startup at $4.5 billion. Nvidiathe leading manufacturer of AI chips, announced more than two dozen investments in venture companies related to artificial intelligence during this year.

Meanwhile, as we mentioned at the outset, OpenAI is exploring a new chip project with G42, a UAE-based firm with close ties to the Abu Dhabi government, according to sources familiar with the situation. The sources, who wished to remain anonymous, claim that OpenAI has discussed an initial round of raising between $8 billion and $10 billion by G42 for the chip project, codenamed Tigris. The goal is to create AI chips that can compete with Nvidia's products.

OpenAI and G42 had already announced a partnership in October to deliver AI solutions to the UAE and regional markets, but did not disclose financial details. The G42, established in 2018, is chaired by Sheikh Tahnoon bin Zayed Al Nahyan, UAE National Security Advisor and Chairman of the Abu Dhabi Investment Authority.

The leadership of OpenAI was briefly shaken the sudden firing of CEO Sam Altman in November. Some investors considered writing off their stakes in the company following the board's decision. However, Altman was returned after five days later, and a new board was appointed. The company is trying to reassure its users, stressing that attention is being refocused on its products after the crisis.