Key points
- OpenAI accelerates its $30 billion raise
- The race for investors before Anthropic's IPO
- OpenAI pitches a $50 billion revenue run rate
OpenAI is speeding up efforts to lock in investor commitments for a funding round of about $30 billion before rival Anthropic's expected IPO in mid-November, Reuters reported. The round could value OpenAI at more than $1.4 trillion, and it is expected to move faster than is typical for a raise of its size.
SoftBank Group (SFTBY), Abu Dhabi's MGX, and other existing OpenAI backers are in talks to join. OpenAI met with long-only funds and sovereign wealth funds last week, while Anthropic was holding its own investor day. Long-only funds buy stocks without betting against them. OpenAI and SoftBank declined to comment. Anthropic and MGX did not immediately respond.
Both companies are chasing the same investors
The report ties the faster timetable, in part, to a push to get ahead of Anthropic, since the two AI labs are increasingly tapping the same pool of investors. Some investors see OpenAI's push as a way to lock in money from funds that might otherwise put more into Anthropic's IPO.
The report says OpenAI also wants to finish before Anthropic's financial disclosures give investors a fuller picture of its business and invite side-by-side comparisons. Those disclosures could lead investors to press OpenAI Chief Financial Officer Sarah Friar for more detail on revenue growth.
"OpenAI could want to set its own valuation and not have to worry about a comp (comparison)," said Edward Best, co-chair of capital markets at the law firm Willkie Farr & Gallagher, who isn't working on the deal and spoke hypothetically.
Investors familiar with OpenAI say the company also needs the money for its large infrastructure commitments, and as a cushion if weaker IPO markets push back its planned 2027 listing.
OpenAI is pitching $50 billion in annualized revenue
OpenAI is telling investors its growth picked up after the launch of its GPT-6 Astra model. OpenAI says annualized revenue has reached $50 billion and expects that figure to hit $70 billion by the end of the year. Annualized revenue takes a recent stretch of sales and projects it over 12 months.
OpenAI says price cuts on its cheaper models have increased usage and that there is room to lower prices further.
The two companies count revenue differently. OpenAI subtracts the share that goes to partners before reporting revenue. OpenAI has accused Anthropic of inflating revenue by counting the full value of contracts sold through cloud providers. Anthropic has said previously that the company follows established accounting practices.
Anthropic's annualized revenue reached about $65 billion by July. Its third-quarter revenue rose 45% to $16.8 billion, the company told investors at its Oct. 14 investor day. Revenue had more than doubled in the second quarter. Some investors were disappointed by that slower quarter-over-quarter growth, and some discussed a valuation of about $1.5 trillion, down from the $2 trillion or so that investors had previously expected.
OpenAI's last valuation was $852 billion
OpenAI was valued at $852 billion in March, after a record $122 billion round that included a commitment of up to $50 billion from Amazon (AMZN). In early October, OpenAI was in talks with MGX and BlackRock (BLK) to anchor the new round.
Other companies are working around Anthropic's timing too. Several companies preparing to go public have decided to wait until after Anthropic's listing, and some late-stage companies are timing private rounds to avoid it, according to bankers and investors. Blackstone-backed AirTrunk REIT, Nvidia-backed Firmus, and SoftBank-backed SB Energy have pulled or paused their listings.
The market has been rough for AI stocks. Companies in the Philadelphia Semiconductor Index have lost $1.6 trillion in market value in less than two weeks. Cloud provider CoreWeave (CRWV) saw its shares and debt fall last week as investors looked at the nearly $50 billion CoreWeave has borrowed to expand.
