Key points
- OpenAI's $11 billion is reportedly now in hand
- OpenAI's CFO pushes back on the smaller-round story
- Anthropic's IPO talk falls near OpenAI's valuation
OpenAI has received about $11 billion in new funding at a $1.25 trillion valuation, Bloomberg reported on Nov. 6. The round could reach as much as $20 billion, with the rest expected in the coming weeks. OpenAI declined to comment.
The $11 billion figure has surfaced before. The Wall Street Journal reported on Oct. 30 that OpenAI had secured roughly that amount in commitments after tepid interest from some large investors. Bloomberg said the money had now been wired and noted that the Journal had previously reported some details of the funding.
OpenAI's $1.25 trillion valuation falls within the $1.2 trillion to $1.3 trillion range that some prospective buyers in Anthropic's IPO (ANT) are discussing. At the start of October, the reported range for Anthropic was $1.8 trillion to $2 trillion. The valuations may not be on the same basis: OpenAI's figure is before the new funding, while the reports on Anthropic's range don't specify whether it includes money raised in the IPO.
How OpenAI's round shrank
| Date | Amount | Valuation | Source |
|---|---|---|---|
| Sept. 29 | Sought at least $30 billion | About $1.4 trillion | Bloomberg |
| Oct. 22 | Sought up to $30 billion | $1.25 trillion | CNBC |
| Oct. 30 | Target cut to $20 billion | $1.25 trillion | Financial Times |
| Oct. 30 | Roughly $11 billion committed | $1.25 trillion | The Wall Street Journal |
| Nov. 6 | Roughly $11 billion wired | $1.25 trillion | Bloomberg |
By our calculations, $11 billion is about 37% of the original $30 billion target. It's about 9% of the $122 billion OpenAI raised in March at an $852 billion valuation.
Coatue Management and T. Rowe Price put money into the first close, Bloomberg's report said. SoftBank, Sequoia Capital, Founders Fund, and Andreessen Horowitz are also investors in the round, and a syndicate of backers from the United Arab Emirates joined. OpenAI is working with investment banks to raise from high-net-worth individuals and retail investors as well. Reuters reported that SoftBank and MGX participated, and it put OpenAI's initial valuation goal at $1.5 trillion.
On Nov. 2, OpenAI signed deals across energy, investment, and government in the UAE while working to secure funding from investors there.
OpenAI's CFO says the price is a step up
Earlier on Nov. 6, Chief Financial Officer Sarah Friar was asked on CNBC whether OpenAI is raising at a lower valuation and raising less than originally expected. "No, we are in a current round right now," she said. Friar said the round is priced at $1.25 trillion before the new money. "The round is ongoing, but we feel quite confident in it."
When she was reminded of the $1.4 trillion figure, Friar said the talk began with another outlet's report of $1.2 trillion. She called $1.25 trillion "almost a 50 percent lift in valuation from the round we closed in March." By our calculations, the increase is about 47%. The March figure included the money raised in that round, while Friar's $1.25 trillion doesn't include the new money.
Both starting points appeared in the talks. We reported on Sept. 29 that OpenAI had previously considered $1.2 trillion before seeking about $1.4 trillion.
Friar also said OpenAI's business grew 70% quarter over quarter in the third quarter and that its enterprise business doubled. Asked whether Anthropic going first complicates the raise, she said, "raise money when you can, but also run your own race."
Similar valuations rest on different revenue
OpenAI told investors its annualized revenue was nearly $50 billion for September, and it expects that annualized figure to reach or exceed $70 billion by the end of the year. At $1.25 trillion, OpenAI is valued at about 25 times the September figure and about 18 times the year-end forecast, by our calculations.
Anthropic's run rate reportedly topped $80 billion at the end of October, though Anthropic hasn't published that number. On that figure, a $1.2 trillion to $1.3 trillion valuation would be about 15 to 16 times the run rate, as we calculated earlier on Nov. 6.
The two sets of numbers aren't directly comparable. They cover different dates, and the companies count revenue differently. Anthropic includes the gross amount of certain sales through cloud partners. OpenAI's reported September figure excludes sales through partners such as AWS and Google Cloud. OpenAI's IPO filing is also still confidential, while Anthropic's is public.
Anthropic's number isn't a price yet, either. No IPO valuation has been set, and Anthropic hasn't announced a change to its timetable. The Information reported on Nov. 6 that Anthropic will proceed with its IPO roadshow next week.
Two things come next. OpenAI could raise up to about $9 billion more to reach $20 billion, by our calculations. Anthropic could file an amended prospectus with a price range. Asked about OpenAI's own IPO, Friar said, "I think last we said we would continue to look in '27." Our OpenAI IPO tracker logs each step.
