OpenAI Closes US$40bn Funding Round led by SoftBank

OpenAI has raised US$40bn at a US$300bn post-money valuation in a funding round led by SoftBank and including other backers such as core investor Microsoft, Coatue, Altimeter and Thrive.

The deal is widely reported as the largest private tech funding round on record – according to market intelligence platform PitchBook it is nearly three times the largest amount raised previously by a private tech firm. 

PitchBook’s data shows that the valuation sees OpenAI leapfrog TikTok creator ByteDance in its list of the most valuable VC-backed companies. It’s now second only to Elon Musk’s SpaceX, valued at US$350bn.

OpenAI says the funding “enables us to push the frontiers of AI research even further, scale our compute infrastructure and deliver increasingly powerful tools for the 500 million people that use ChatGPT every week”.

Scaling transformative technology

OpenAI will initially receive US$10bn, with US$7.5bn from SoftBank and the remaining US$2.5bn from “an investor syndicate”, Bloomberg reports.

The remaining US$30bn will reportedly follow by the end of 2025. 

There is a caveat to the funding round. A SoftBank Group release on the investment says that funding could be lowered if OpenAI doesn’t complete its transition to a for-profit entity by the end of 2025. 

In the release, SoftBank says that AI represents the newest phase of the “information revolution” and that its mission is to realise artificial super intelligence (ASI) for the advancement of humanity. 

“Recognising OpenAI as the partner closest to achieving Artificial General Intelligence (AGI), a key milestone on the path to ASI, and its mission of ensuring AGI benefits all of humanity, SBG (SoftBank Group) has positioned OpenAI as its most important partner,” says SoftBank.

“The advancement of OpenAI’s AI models is key to achieving AGI and ASI, and massive computing power is essential. To that end, SBG has announced the ‘Stargate Project’ together with OpenAI on January 21, 2025, to build dedicated AI infrastructure for OpenAI in the United States.”

OpenAI’s growth trajectory

The Sam Altman-led firm hasn’t slowed down over the last months. In October 2024 the business closed a US$6.6bn funding round which, at the time, made it one of the world’s highest valued private companies. 

On 31 March, the company experienced record growth after releasing its new ChatGPT4o image generation tool. 

The new feature lets ChatGPT users create images using natural language prompts – they can describe what they wish to see and the image tool generates a result within seconds. 

It quickly went viral after social media feeds were flooded with AI-generated images and memes in the style of Japanese animation company, Studio Ghibli, which is behind cult animated movies such as Spirited Away. 

Viral posts included reworkings of popular movies and an AI-version of the heated White House discussion between US President Donald Trump, Vice President JD Vance and Ukrainian President Volodymyr Zelensky. 

Altman himself joined in, adding a Studio Ghibli-style self portrait to his X social media account. 

As a result of the popularity of the image generator, the company welcomed a flurry of new users. 

Altman posted on X that the launch was “one of the craziest viral moments I’d ever seen, and we added one million users in five days,” adding that the firm “added one million users in the last hour”.

The latest funding round will allow the company to build on this growth. 

It says it “will help us continue building AI systems that drive scientific discovery, enable personalised education, enhance human creativity and pace the way toward AGI that benefits all of humanity”.

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