OpenAI, the innovator powering ChatGPT, revealed Monday it has locked in a historic $40 billion funding round—the largest ever for a private tech firm. The deal pegs the company’s valuation at $300 billion, including the new cash, dwarfing the prior record for a private tech raise, which was less than a third of this amount, per PitchBook data.
This valuation slots OpenAI just below SpaceX’s $350 billion mark and neck-and-neck with ByteDance, TikTok’s parent, among the globe’s priciest private outfits, according to CB Insights. SoftBank, the Japanese investment juggernaut, is driving the round with a $30 billion pledge, joined by heavyweights like Microsoft—a longtime backer—plus Coatue, Altimeter, and Thrive.
OpenAI plans to channel the funds into advancing AI research and expanding its computing muscle, according to a company blog post. A source close to the deal told CNBC that $18 billion is earmarked for Stargate, a high-profile collaboration with SoftBank and Oracle, unveiled by President Donald Trump in January.
The cash will roll out in phases: $10 billion upfront, with the rest due by December 31, 2025. But there’s a hitch—SoftBank’s latest filing warns its contribution could shrink to $20 billion if OpenAI doesn’t convert to a for-profit structure by year-end. That deadline intensifies scrutiny on OpenAI’s complex shift from its nonprofit roots, a move requiring nods from Microsoft and California’s Attorney General. Elon Musk, a 2015 co-founder when OpenAI launched as a nonprofit lab, is also suing to block the change.
OpenAI’s current setup—a hybrid with a capped-profit partnership formed in 2019—ties its venture investors to convertible notes awaiting equity conversion. The original nonprofit, still the controlling stakeholder, would split off as a standalone entity if the restructuring clears its hurdles.
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