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OpenAI has finalized a deal that allows employees to sell their shares in the company, which is now valued at $500 billion. This valuation surpasses that of Elon Musk’s SpaceX, making OpenAI the world’s most valuable startup. Current and former employees sold approximately $6.6 billion worth of stock to investors, including Thrive Capital, SoftBank, Dragoneer Investment Group, Abu Dhabi’s MGX, and T. Rowe Price.
This marks a sharp jump from the company’s $300 billion valuation during a SoftBank-led round earlier this year.
The surge reflects the excitement around AI advancements, which can transform industries and economies. OpenAI, founded by CEO Sam Altman, is one of the leading companies fueling global investment in AI infrastructure.
It has struck major deals with companies such as Oracle and SK Hynix in support of the broader push to construct data centers and AI services, a market that could be worth trillions of dollars.
The timing of the deal is interesting. OpenAI is in talks with Microsoft to transition to a more conventional for-profit form. However, it still maintains its status as a public benefit corporation, held in trust by the founding nonprofit.
Founded in 2015, OpenAI began as a nonprofit organization dedicated to developing AI for the benefit of everyone. However, detractors, including Musk, contended that accepting billions of dollars in support from Microsoft was against the nonprofit’s founding ideals.
The AI market is highly competitive, with large companies competing for top talent. Meta, for instance, has poached numerous OpenAI employees, including some with nine-figure offers to researchers. Offering the secondary sale of shares, OpenAI can incentivize employees, give liquidity, and keep them from leaving for lucrative offers presented by other companies.
The secondary sale didn’t reach the $10 billion worth of stock permitted by OpenAI for purchase. It shows that the employees are optimistic about the company’s future and would rather retain some of their stocks.
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Although its valuation is record-breaking, OpenAI also faces intense competition from competitors, including Google and Anthropic. To stay ahead of the competition, the company continues to launch innovative AI tools, such as the GPT-5 model in August. The latest innovations make it more dominant in a growing, crowded market.
OpenAI's swift rise highlights the excitement surrounding AI, and its choices in the future could significantly influence the technology's future and the startup ecosystem for years to come.
