OpenAI, the artificial intelligence research lab behind chatbot ChatGPT, is in talks to sell existing shares in a tender offer that would value the company at about $29 billion (roughly Rs. 2,39,700 crore), the Wall Street Journal reported on Thursday, citing people familiar with the matter.
The report added that the deal is structured in a way in which venture capital firms Thrive Capital and Founders Fund will buy shares from existing shareholders such as employees.
The deal would attract investment of at least $300 million (roughly Rs. 2,480 crore) in share sales, it added.
Billionaire and Tesla CEO Elon Musk founded the research organisation with investor Sam Altman.
Microsoft which invested $1 billion (roughly Rs. 8,260 crore) in OpenAI in 2019, was working to launch a version of its search engine Bing using the AI behind the now viral ChatGPT, the Information reported on Tuesday.
OpenAI’s chatbot is a software application designed to mimic human-like conversation based on user prompts and can respond to a large range of questions while imitating human speaking styles.
The firm expects business to surge as it pitched to investors saying the organisation expects $200 million (roughly Rs. 1,650 crore) in revenue next year and $1 billion by 2024, Reuters reported in December. Three sources briefed on OpenAI’s recent pitch to investors said the organisation expects $200 million in revenue next year and $1 billion by 2024.
The forecast, first reported by Reuters, represents how some in Silicon Valley are betting the underlying technology will go far beyond splashy and sometimes flawed public demos.
Microsoft, providing OpenAI capital and computing power for its software, is a beneficiary. Asked about ChatGPT and whether Microsoft viewed such technology as experimental or strategic, its President Brad Smith told Reuters that AI has progressed faster than many predicted.
OpenAI and Thrive Capital declined to comment, while Founders Fund did not immediately respond to a Reuters request for comment.
© Thomson Reuters 2023
