These days, we hear about hot AI corporations raising massive funding rounds at multi-billion dollar valuations.
However, when the news got here out this week that OpenAI Is in conversations in a recent funding round valued at over $100 billion, showed just how high the stakes have turn into. The investment, which reportedly includes support from Develop capital AND Microsoftwhich represents a 16% increase from OpenAI’s last known valuation.
That’s a huge number, even by the standards of venture-backed unicorns. So we’ve gathered some comparable stats to place them in context.
- At $100 billion, OpenAI might be valued higher than GDP 110 countries. It might be valued at greater than twice the GDP of Uganda, a country of 47 million people, and about seven times larger than Madagascar, with 30 million people and a surface area larger than Spain.
- The generative AI giant may even be valued at greater than the initial market capitalization of any U.S. venture-backed startup that goes public, with the exception of Facebook (currently Finish), which debuted in 2012 with a valuation of $104 billion. For comparison, the next two largest corporations are Uber in 2019 (82.4 billion USD) and Rivian in 2021 ($66.5 billion).
- OpenAI’s value might be significantly higher than the biggest startup acquisitions of all time. The largest acquisition so far is Meta’s $19 billion acquisition WhatsApp in 2014. (Adobeplanned takeover of the company for $20 billion Figma would have been the biggest, but it was disbanded late last 12 months.)
- $100 billion investment would make OpenAI the most dear private US venture-backed company SpaceXwhich was reportedly recently considering an offer to purchase the shares at a price Value $210 billion.
What recent history says about record valuations
There are actually questions about whether OpenAI — a company that loses a lot of money on revenues estimated at about $3.4 billion a 12 months — needs to be valued at $100 billion.
But recent history has shown that the most highly valued startups often live as much as their investors’ high expectations over time. Meta, for example, is now a $1.3 trillion company, and Uber was recently valued at about $150 billion.
Others have failed. Rivian, for example, is value a fraction of its initial IPO valuation. Uber rival Lyft The company also debuted with a bang in 2019, reaching a market capitalization of $24 billion, and since then the value of its shares has been steadily declining.
So, while one is likely to be cautious about betting on OpenAI’s performance at these levels, there are also reasons to consider that betting against it could be dangerous.