OpenAI recently announced a $1.5 billion stock buyback plan to be launched in collaboration with SoftBank. This plan is an extension of SoftBank's recent $6.6 billion investment in OpenAI, which has now reached a valuation of $157 billion.
According to sources, this transaction is driven by SoftBank's founder and CEO Masayoshi Son, who hopes to acquire a larger stake in OpenAI.
This financing not only provides SoftBank with an opportunity to increase its stake in OpenAI but also offers current and former OpenAI employees a chance to cash out. Employees participating in the stock buyback must have received restricted stock units two years ago and still hold them. Employees can decide whether to participate in the program by December 24. This transaction is unrelated to any potential company restructuring plans for OpenAI in the future.
SoftBank's interest in investing in the AI sector is growing. At a recent meeting, Masayoshi Son stated that he is reserving "tens of billions of dollars" for larger investments in artificial intelligence. In addition to OpenAI, SoftBank has also invested early in Arm and participated in investments in companies like Apple, Qualcomm, and Alibaba.
SoftBank's Vision Fund 2 has recently invested in several AI startups, such as Glean, Perplexity, and Poolside. Currently, SoftBank manages $160 billion in assets across 470 portfolio companies.
Before SoftBank's investment, OpenAI had already been able to easily raise billions of dollars. Since the launch of ChatGPT, OpenAI's valuation has soared to $157 billion within two years. Its total funding amounts to $13 billion, which includes support from Microsoft. Additionally, OpenAI has secured a $4 billion revolving credit facility, bringing its total liquidity to over $10 billion.
Although OpenAI expects to generate $3.7 billion in revenue this year, it also anticipates facing losses of about $5 billion. This stock buyback will help employees gain liquidity in the current private market environment without relying on going public.
In the past, OpenAI had a stricter policy regarding stock buybacks, but since this summer, the company has eased restrictions on stock sales. In the future, OpenAI plans to continue increasing opportunities for such secondary sales to meet investor demand.
Meanwhile, OpenAI is facing fierce competition from startups like Anthropic and tech giants like Google. Market analysts predict that the generative AI market will exceed $1 trillion in revenue over the next decade, with corporate spending in this field increasing by 500% this year.
Recently, OpenAI launched a search feature in its popular ChatGPT, enabling it to compete more effectively with search engines like Google, Microsoft Bing, and Perplexity.
Key Points:
🤑 OpenAI launches a $1.5 billion stock buyback plan, allowing employees to cash out.
📈 SoftBank increases its stake in OpenAI, demonstrating strong investment interest in the AI sector.
🚀 The generative AI market is expected to exceed $1 trillion in revenue over the next decade.
