OpenAI Secures $40B Funding from SoftBank

OpenAI has just snagged a whopping $40 billion in a new funding round, with SoftBank leading the charge. This massive injection of cash has bumped the company's valuation up to a staggering $300 billion, making it the biggest funding round ever for a private tech company, according to CNBC.

Here's how it breaks down: SoftBank is throwing in $7.5 billion, and another $2.5 billion is coming from a group of investors, as Bloomberg reported. But there's a catch—the remaining $30 billion won't hit the bank until the end of the year, and only if OpenAI officially becomes a for-profit company by then. If that doesn't happen, they could lose a quarter of the deal, CNBC noted.

This funding news comes hot on the heels of OpenAI's announcement about Stargate, a $500 billion project backed by SoftBank, Oracle, and the Abu Dhabi fund MGX. They're planning to build huge AI datacenters over the next four years. The company's been on a roll lately. Just this Monday, CEO Sam Altman shared that OpenAI added a million users in just one hour, thanks to a new feature called Images in ChatGPT. This feature went viral because it can create AI art inspired by Studio Ghibli. And on Wednesday, Altman announced they're working on a new open-weight language model with reasoning capabilities, set to be released soon. The funding announcement also mentioned that ChatGPT now serves 500 million people every week.

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Despite the incredible growth driven by ChatGPT, OpenAI is still burning through cash like there's no tomorrow. Bloomberg reported that the company is expecting to rake in $12.7 billion this year, a huge leap from last year's $3.7 billion in annualized recurring revenue. But, they're not expecting to be cash flow positive until 2029, when they project to hit $125 billion in revenue.

OpenAI's funding announcement stressed their mission to build "AGI that benefits all of humanity." Altman has been upfront about what it'll take to make this happen—massive amounts of computing power, energy, global infrastructure, and, of course, a ton of money. This latest round of funding, they say, brings them one step closer to that goal.