OpenAI Eyes $500 Billion Valuation in Employee Share Sale

OpenAI is in early discussions for a secondary stock sale that would:

• Allow current and former employees to cash out their shares.
  
• Potentially value the company at ~$500 billion.
  
• Come prior to a future IPO.
  

Valuation Context

• Current valuation: $300 billion
  
• Target valuation in share sale: $500 billion
  
• A significant increase reflecting:
  
  • Rapid growth in users and revenue
    
  • Intense competition in the AI industry for talent
    

Revenue and User Growth

• Annualized revenue run rate:
  
  • $12 billion (as of July)
    
  • Projected to reach $20 billion by year-end
    
• Weekly active users for ChatGPT:
  
  • Now at 700 million, up from 400 million in February
    

Funding and Investor Involvement

• Part of a broader $40 billion primary funding round:
  
  • Led by SoftBank, which has until year-end to fund its $22.5 billion portion.
    
  • Remaining amount already subscribed at a $300 billion valuation
    
• Existing investors like Thrive Capital are in talks to participate in the employee share sale.
  

Industry Trends & Talent War

• Meta is reportedly investing billions into Scale AI to attract CEO Alexandr Wang.
  
• Firms like ByteDance, Databricks, and Ramp have used similar share sales to:
  
  • Refresh valuations
    
  • Reward long-term employees

Future Outlook

• OpenAI is considering corporate restructuring to move away from its capped-profit model.
  
• This could pave the way for a future IPO.
  

CFO Sarah Friar has stated that an IPO will only occur when the company and markets are ready.