OpenAI nears a $30 billion raise at $1.25 trillion, $150 billion below its first pitch
OpenAI is close to raising up to $30B at a $1.25T valuation led by Coatue and UAE investors, a bridge to an IPO after it first pitched $1.4T.
The skim
- OpenAI is close to raising up to $30 billion at a $1.25 trillion valuation, led by Coatue and investors from the United Arab Emirates, CNBC reported Thursday, citing people familiar with the deal.
- That's $150 billion below the $1.4 trillion discussed earlier in the talks, according to Bloomberg. The Financial Times says some investors balked at the higher price.
- It would still be roughly 47% above OpenAI's $852 billion valuation in March. The money is a bridge to an IPO, and OpenAI wants commitments by the end of next week.
What's reportedly on the table
OpenAI is raising up to $30 billion at a $1.25 trillion pre-money valuation, a figure that doesn't count the new cash, CNBC reports. Coatue and UAE investors are leading, and the round is being framed as an "opportunistic" bridge to an initial public offering. OpenAI hopes to have signatures by the end of next week, though the final size is still being settled. The Financial Times puts the commitment deadline at Oct. 30.
A second deal may ride along. OpenAI is negotiating for more computing capacity in the UAE, according to one of CNBC's sources, and the company is targeting about $600 billion in compute spending by 2030. These days, money and data centers tend to arrive together. OpenAI declined to comment to TechCrunch and Bloomberg.
The price came down
The headline number is a markdown. Bloomberg says the valuation under discussion moved down by $150 billion, from $1.4 trillion, in the final stage of talks, and that details could still change. According to the Financial Times, investor demand was weaker this time. Some investors balked at $1.4 trillion, and others are waiting to see how Anthropic's IPO is priced.
The timing explains a lot. AI stocks slid this week on worries that the industry's spending has gone too far. The Nasdaq fell nearly 3% on Thursday, and Meta dropped almost 8%, Reuters reported. Asking private investors for another $30 billion in that market is a harder sell than it was in the spring.
Why it matters
Even marked down, the round is a big step up. In March OpenAI raised $122 billion at an $852 billion valuation, including the new money. At $1.25 trillion it would be worth about 47% more, and well above the $965 billion Anthropic fetched in May.
It also tells you OpenAI isn't in a hurry to list. The company filed confidentially for an IPO in June. CFO Sarah Friar said in August that OpenAI "will be a public company in 2027," while CEO Sam Altman said in September that "right now would be an ill-advised moment to go public." A private round buys time without fixing a public price.
That price matters most next to Anthropic's. Its IPO is expected in November, according to Bloomberg, and it is reportedly seeking $1.5 trillion to $2 trillion (we covered Anthropic's draft S-1 this week). If Anthropic lists first at that level, it sets the benchmark OpenAI will be measured against.
What's next
Watch for commitments around Oct. 30, the final size of the round, and whether a UAE compute deal is announced with it. Until OpenAI confirms anything, all of this rests on reporting from people familiar with the talks.
Sources: CNBC, TechCrunch, Bloomberg, Financial Times and Reuters.
