OpenAI Seeks Up to $30 Billion at $1.25 Trillion Valuation

UAE Investors, Coatue to Lead Funding

Also Negotiating Deal to Secure More Computing Infrastructure

OpenAI is close to raising fresh capital in a deal that would value the company at $1.25 trillion. The company is seeking to raise as much as $30 billion ahead of an initial public offering. UAE investors are leading the financing, and OpenAI is also in talks to secure additional computing resources in the country.

CNBC reported on Oct. 22, citing people familiar with the matter, that OpenAI is pursuing the fundraising on those terms. The $1.25 trillion valuation is on a pre-money basis. UAE investors and U.S. investment firm Coatue are participating in the round.

OpenAI told investors that it aims to secure signatures on investment agreements by next week. The financing is intended to raise capital the company needs before a listing. Discussions gathered pace last month after investors proposed a new investment.

Alongside the fundraising, OpenAI plans to expand the computing infrastructure needed to develop and run its AI models. The company is separately negotiating a commercial contract to obtain additional computing resources from the UAE. In February, it told investors it planned to spend about $600 billion on computing by 2030.

OpenAI confidentially filed a registration statement for an IPO with the U.S. Securities and Exchange Commission in June. Chief Financial Officer Sarah Friar told employees in August that OpenAI would be a public company next year.

Still, Chief Executive Officer Sam Altman said last month that now is not the right time to go public. The company appears to be placing more weight on raising additional capital in private markets than on rushing the timing of an IPO.

Rival Anthropic is also preparing a large IPO. Like OpenAI, it confidentially filed its registration statement in June and has recently been meeting potential investors to outline its performance and business outlook.

Anthropic is targeting a valuation of $1.5 trillion to $2 trillion in the listing. In May, the company raised $65 billion at a $965 billion valuation. It is now pushing for another large capital raise in public markets. The high cost of AI development and infrastructure expansion is extending the two companies' competition for funding into the IPO market.