SoftBank to Buy Up to $1.5bn Worth of Stock in OpenAI
SoftBank’s Ambition to Bolster Its Position in the Artificial Intelligence Company
SoftBank is planning to buy up to $1.5 billion worth of stock in OpenAI, the $150 billion artificial intelligence company, to bolster its position in the company. The deal is set to close early next year.
How the Deal Will Work
SoftBank will buy the shares through a tender offer, a mechanism that allows current and former OpenAI employees who have held their stock for more than two years to sell. The deal will price employee stock according to OpenAI’s last funding round, which was completed last month, valuing the company at $150 billion.
SoftBank’s Investment in OpenAI
SoftBank’s second Vision Fund, its tech-heavy investment vehicle, invested $500 million in OpenAI during that round. The same fund, in which SoftBank’s CEO Masayoshi Son has a substantial stake, is also buying the $1.5 billion in shares.
AI Start-Ups’ Valuations Soar
AI start-ups have raised tens of billions of dollars in debt and equity this year, as investors look past eye-watering valuations for lossmaking companies to make bets on the technology. Elon Musk’s AI start-up xAI is expected to close a $5 billion funding round this week, valuing the company at $45 billion, while OpenAI’s valuation has nearly doubled this year. Last week, rival Anthropic received a second $4 billion investment from Amazon.
Masayoshi Son’s Ambition
Son has publicly expressed his admiration for OpenAI’s CEO Sam Altman and has said he frequently talks to him. The tech investor has been seeking a larger stake in the company, according to people familiar with the matter.
Key Backers of OpenAI
SoftBank is one of OpenAI’s largest backers, alongside Josh Kushner’s Thrive Capital, which has poured more than $1 billion into the group. Tiger Global, Altimeter Capital, Coatue Management, and Abu Dhabi-based tech investment firm MGX have also made substantial bets on the company.
Conclusion
SoftBank’s investment in OpenAI is a significant move to bolster its position in the artificial intelligence company. The deal will help to further solidify SoftBank’s position in the AI industry and demonstrate its commitment to the technology.
Frequently Asked Questions
Q: What is the value of OpenAI after the funding round?
A: OpenAI is valued at $150 billion after the latest funding round.
Q: How much will SoftBank invest in OpenAI?
A: SoftBank will invest up to $1.5 billion in OpenAI.
Q: Who are the key backers of OpenAI?
A: SoftBank, Josh Kushner’s Thrive Capital, Tiger Global, Altimeter Capital, Coatue Management, and Abu Dhabi-based tech investment firm MGX are among the key backers of OpenAI.
Q: What is Masayoshi Son’s ambition for SoftBank?
A: Son is seeking to position SoftBank as a leader in the artificial intelligence industry, with a focus on realizing "Artificial Super Intelligence".
