ChatGPT maker OpenAI in talks to raise funds at $29bn valuation

6 Jan 2023

Image: © piter2121/

The potential deal comes after an eventful year for the company, which gained attention for its experimental chatbot and an advanced text-to-image generator.

OpenAI, the company behind software such as ChatGPT and DALL-E, is reportedly in talks to raise capital at a valuation of almost $30bn, according to the Wall Street Journal (WSJ).

The company is in talks with VC firms Thrive Capital and Founders Fund to buy existing shares in a tender offer, sources familiar with the matter told WSJ.

The new deal is set to surge OpenAI’s valuation from 2021, when it completed another tender offer. The company was valued at roughly $20bn that year after a secondary share sale, the Financial Times reports.

However, the terms of the deal could change as discussions are currently ongoing, one source told the Financial Times.

The news comes roughly one month after OpenAI launched ChatGPT, an experimental chatbot designed to answer questions in a conversational way. A public demo of the AI was released and rapidly gathered attention, reaching more than 1m users by 5 December.

However, while many users praised the experimental AI for its ability to respond to questions, some posted examples of the chatbot creating biased or racist content. Other examples showed the chatbot providing incorrect answers to questions.

Around the time ChatGPT crossed 1m users, Stack Overflow, a Q&A site for programmers, issued a temporary ban on answers created by the chatbot.

Despite the criticism toward the public demo, the chatbot continues to garner public and private attention. Earlier this week, it was reported that Microsoft is planning to upgrade its Bing search engine using ChatGPT.

In 2019, Microsoft invested $1bn into OpenAI to help bring “secure, trustworthy and ethical” AI to serve the public, while focusing on constructing Azure AI supercomputing technologies. WSJ reported last October that the tech giant is in talks to give a new round of funding to OpenAI.

OpenAI also gained a lot of attention from its advanced text-to-image generator, DALL-E 2. When users input a phrase or a string of words into this AI system, it generates multiple images based on the text prompt.

The AI research company created the first version of DALL-E in 2021. The new version, DALL-E 2, was unveiled last April, and OpenAI said it “generates more realistic and accurate images with four times greater resolution”.

The company expanded access to this AI model last July, when it offered 1m people early access to a beta version of DALL-E 2.

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Leigh Mc Gowran is a journalist with Silicon Republic