Investment

SoftBank to Invest $500 Million in OpenAI: Report

• ByStartupStory     |    October 1, 2024

Japanese telecom giant SoftBank’s Vision Fund is set to invest $500 million in OpenAI’s latest funding round, according to a report by The Information on Monday. The report cites a person familiar with the deal, highlighting SoftBank’s growing interest in the artificial intelligence (AI) space.

While SoftBank declined to comment on the matter, OpenAI, the company behind the widely popular AI model ChatGPT, has not yet provided an immediate response.

The $500 million investment is part of OpenAI’s broader plan to raise $6.5 billion through convertible notes, as previously reported by Reuters earlier this month. The round, which initially attracted interest from major companies, including Apple, now values the AI startup at a staggering $150 billion before the latest SoftBank investment.

However, the valuation hinges on OpenAI’s ability to overhaul its corporate structure and eliminate the profit cap for investors—a significant shift for the company.

The deal marks SoftBank’s first direct investment in the Sam Altman-led AI firm, underscoring the telecom company’s strategic entry into the booming AI industry.

Reuters also reported last week that OpenAI is actively working on restructuring its core business into a for-profit entity. This transition would effectively end the non-profit board’s control over the company, paving the way for more significant investments and potential operational changes.

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