SoftBank is reportedly planning a $500 million investment in OpenAI, the artificial intelligence firm behind ChatGPT, as part of the company’s broader efforts to expand its AI portfolio. According to a report by The Information, the Japanese telecom and tech conglomerate is making this investment at a time when OpenAI is seeking to raise $6.5 billion in a new funding round. Earlier this month, Bloomberg noted that the latest round is expected to value OpenAI at $150 billion.
This would mark SoftBank’s first investment in OpenAI, as the AI company continues to grow its influence in the tech world. Notably, Apple has opted not to participate in this current round of funding.
A potential challenge for OpenAI, however, lies in removing its “profit cap” for investors. Founded in 2015 as a non-profit, OpenAI transitioned in 2019 by creating a “capped-profit” subsidiary that limits investor returns to 100 times their investment. The company is now considering restructuring to become a fully for-profit entity, a shift that could significantly increase CEO Sam Altman’s wealth. If successful, the change could net Altman an estimated $10.5 billion. Currently, Altman, a co-founder of OpenAI alongside Elon Musk and others, has been drawing a modest $65,000 annual salary.
Altman has previously stated that he has no equity in OpenAI, a claim he made during a U.S. Senate hearing on AI regulation. However, The Guardian recently reported that Altman indirectly benefits from his stake in Y Combinator, which holds shares in OpenAI. This connection could mean that Altman stands to profit significantly if OpenAI achieves its targeted valuation.
In addition to its funding efforts, OpenAI continues to grow its user base, with over 200 million people using its ChatGPT AI chatbot each month. This surge in popularity highlights the increasing demand for AI-powered tools, as OpenAI looks to solidify its leadership in the field.
