OpenAI was reportedly valued at around $29 billion in January 2023, despite revenue to date being in the tens of millions. The reported valuation rested on expectations of strong growth, alongside interest from new investors and Microsoft.
A reported valuation built on future growth
The Wall Street Journal, citing anonymous sources, reported that OpenAI’s valuation was expected to be around $29 billion. It said the company’s revenue so far had been in the tens of millions, while OpenAI anticipated substantial growth. In 2021, its valuation was reportedly $14 billion.
The gap between current revenue and reported valuation pointed to what investors appeared to be weighing: not only the company’s existing income, but also the possibility that demand for its AI products could grow significantly. That expectation was ambitious, and depended on turning technical work into products and revenue at scale.
Earlier reporting described OpenAI’s own targets as $200 million in revenue for the coming year and $1 billion for 2024. The company’s anticipated path from comparatively modest revenue to those targets helps explain why the valuation drew attention.
Share sales and investor interest
Venture capital firms Thrive Capital and Founders Fund were reportedly set to buy $300 million worth of OpenAI shares. The planned purchase was described as a sale by existing shareholders, including employees, rather than a sale of newly issued shares by the company.
The Wall Street Journal reported that no final deal had been reached and that its terms could change. That qualification matters: the proposed transaction was a report about a potential deal, not confirmation that the shares had been sold on those terms.
Microsoft was also said to be interested in investing further. The article linked that possibility to a reported plan for ChatGPT to be used in Bing search. Microsoft had already become a major investor, paying more than $1 billion for exclusive access to AI models such as GPT-3.
From research mission to products
OpenAI began in 2015 with a stated ambition to develop artificial general intelligence that benefits humanity, or at least does not destroy it. The article describes a company that initially paid little attention to return on investment and was formerly purely nonprofit.
That position shifted as the need for revenue became clearer. In March 2019, OpenAI moved to a more commercial model and formed the for-profit company OpenAI LP. Its products—including GPT-3, the DALL-E 2 image model and ChatGPT—offered practical uses well before the broader goal of AGI was achieved.
The change also connected OpenAI’s work to Microsoft’s software business. The article said Microsoft was integrating aspects of OpenAI’s AI models into Windows and Office. Commercial products could generate income and give investors a more concrete basis for expecting growth than the long-term AGI mission alone.
Balancing returns with the company’s mission
OpenAI’s structure was described as placing a limit on shareholder profits: the maximum profit per shareholder was said to be a twenty-fold increase. According to OpenAI, this rule was intended to keep the company focused on developing safe and useful AI for society rather than obeying investors alone.
That limit sits alongside the commercial pressures described in the article. OpenAI was seeking investors, competing in a field where Google and Meta were investing billions in AI, and bringing products to market. Its reported valuation reflected confidence in possible growth, while the stated profit cap expressed an effort to preserve the company’s broader purpose.
The $29 billion figure, the potential $300 million share purchase and projected revenue were all reported expectations at the time. Taken together, they show how investors were assessing OpenAI’s products and growth prospects even while its current revenue remained comparatively low.