OpenAI has lowered its valuation target to $1.25 trillion after investors resisted a $1.4 trillion price tag. The ChatGPT maker aims to raise $30 billion before a public offering next year, representing a nearly 50 percent increase from its current $852 billion valuation. The funding round faces weaker demand as US tech stocks sell off amid concerns about the sustainability of the AI infrastructure boom.
Morgan Stanley and Dragoneer previously floated the company at $1.4 trillion to private wealth clients, but client interest was described as a "thud" compared to prior frenzies. Investor fatigue after heavy prior investments also played a role. Other investors prefer to wait and see how rival Anthropic prices its expected initial public offering later this year.
OpenAI set an October 30 deadline for investors, though may raise less than $30 billion. Coatue and UAE funds are in discussions to lead the round, which includes a right of first refusal on new computing power developed by UAE partners.
Source: Financial Times Markets · Summarized by HeadlinesBriefing