OpenAI has completed a deal helping employees sell shares at a $500 billion valuation, making the ChatGPT owner the world’s largest startup and surpassing Elon Musk’s SpaceX.
Current and former OpenAI employees sold about $6.6 billion of stock to investors, reports Bloomberg.
The deal boosted the US company’s valuation well past its previous $300 billion level from a SoftBank-led financing round earlier this year. Investors in the transaction included Thrive Capital, SoftBank Group, Dragoneer Investment Group, Abu Dhabi’s MGX and T. Rowe Price.
OpenAI’s new valuation vaults it past SpaceX’s $400 billion valuation. The milestone comes as Sam Altman’s company negotiates with Microsoft to convert into a more traditional for-profit company from its original 2015 nonprofit structure.
The rapid rise underscores the investment frenzy surrounding artificial intelligence leaders. Though OpenAI has yet to turn a profit, the startup is helping fuel the infrastructure boom by signing deals with companies including Oracle and SK Hynix.
OpenAI faces mounting competitive pressure from rivals, including Google and Anthropic. Meta Platforms has recruited researchers aggressively from OpenAI for its “superintelligence” team, offering pay packages in the nine-figure range.
The secondary sale could help OpenAI incentivise staff to stay and turn down those compensation offers. The total stock sold fell short of the $10 billion-plus worth the company allowed for sale, potentially indicating employee confidence in long-term business viability.
Elon Musk, who co-founded OpenAI with Altman, has sued to stop the company’s restructuring. He claims OpenAI abandoned its founding purpose when it accepted billions in Microsoft backing starting in 2019, the year after he left the board.
In response to competition, OpenAI has launched new technology products, including open artificial intelligence models that can mimic human reasoning processes. The company released its most powerful GPT-5 model in August.
