Abu Dhabi’s MGX, formed earlier this year with Mubadala and G42 as Founding Partners, was a significant investor in the latest round of funding of OpenAI’s, the company behind ChatGPT.
OpenAI raised $6.6 billion from investors, which could value the company at $157 billion, making it one of the most valuable private companies in the world. The round of venture capital funding is considered the largest ever, $600 million more than the $6 billion raised earlier this year by Elon Musk’s xAI.
The company was valued at $14 billion in 2021, which makes for more than a 10-fold jump in less than three years.
OpenAI secures major investments
Apart from MGX, other companies that invested were Microsoft and Nvidia – two of the three biggest companies in the world as per market capitalisation. However, Apple, the world’s biggest company, refrained from participating after showing initial interest.
Thrive Capital, SoftBank, Khosla Ventures, Altimeter Capital, Fidelity, and Tiger Global also invested in the round. Thrive led the round with a $1.25 billion commitment, while Tokyo-based SoftBank is said to have put in around $500 million.
OpenAI was rocked recently by the departure of its longtime Chief Technology Officer, Mira Murati, but it did deter investors’ faith in the Sam Altman-led company. It is expected to generate $3.6 billion in revenue this year, with over $5 billion in losses.
In a blog post, Open AI said: “We’ve raised $6.6 billion in new funding at a $157 billion post-money valuation to accelerate progress on our mission. The new funding will allow us to double down on our leadership in frontier AI research, increase compute capacity, and continue building tools that help people solve hard problems.
“We aim to make advanced intelligence a widely accessible resource. We’re grateful to our investors for their trust in us, and we look forward to working with our partners, developers, and the broader community to shape an AI-powered ecosystem and future that benefits everyone. By collaborating with key partners, including the US and allied governments, we can unlock this technology’s full potential.”
Reuters reported that OpenAI Chief Financial Officer Sarah Friar told employees on Wednesday that the company will be able to provide liquidity for them through a tender offer to buy back their shares following the funding, although no details and timing have been decided. Earlier this year, the company allowed some employees to cash out their shares at a valuation of $86 billion.
It has also been reported by the Financial Times and Wall Street Journal that OpenAI has specifically asked its investors not to fund five rival companies. The list includes Anthropic, xAI, Safe Superintelligence (SSI), AI search startup Perplexity and enterprise search firm Glean.
MGX was founded in March this year to accelerate the development and adoption of AI and advanced technologies. Launched by the Artificial Intelligence and Advanced Technology Council (AIATC), it is one of the world’s largest funds focused solely on AI, aiming to surpass $100 billion in assets under management.
Follow us on
