OpenAI raises up to $40bn in record-breaking deal with SoftBank
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SoftBank will initially invest $10 billion in OpenAI, with an additional $30 billion to follow by the end of 2025, contingent on meeting specific conditions.
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In this July 20, 2017, file photo, SoftBank Group Corp. Chief Executive Officer Masayoshi Son, left, speaks during a SoftBank World presentation at a hotel in Tokyo. (AP)
OpenAI announced it has secured $40 billion in a funding round, valuing the ChatGPT creator at $300 billion, marking the largest capital-raising event ever for a startup.
This milestone is part of a partnership with the Japanese investment group SoftBank, which "enables us to push the frontiers of AI research even further" and will help "pave the way toward AGI (artificial general intelligence)," for which "massive computing power is essential," OpenAI stated.
SoftBank expressed its goal of achieving "artificial super intelligence" (ASI) that exceeds human intelligence, with OpenAI being the partner "closest to achieving that goal."
It will initially invest $10 billion in OpenAI, with an additional $30 billion set to follow by the end of 2025, contingent on certain conditions. Additionally, OpenAI revealed plans to develop a more open generative AI model, responding to increasing competition in the open-source space from DeepSeek and Meta.
OpenAI was once a staunch advocate for closed, proprietary models that prevent developers from modifying the core technology is shifting its stance. “We’ve been thinking about this for a long time, but other priorities took precedence. Now it feels important to do,” said Sam Altman, OpenAI’s CEO.
Read next: Musk's xAI to launch Grok 3, claims it's the 'smartest AI on Earth'
OpenAI and advocates of closed models, including Google, have long criticized open models as riskier and more prone to misuse, particularly by malicious actors or non-US governments.
A former OpenAI investor, Elon Musk, has urged the company to "return to the open-source, safety-focused force for good it once was."
Large corporations and governments remain hesitant to adopt AI models they can't control, especially when it comes to concerns over data security. In contrast, Meta and DeepSeek allow companies to download and modify their models.
Meta's CEO Mark Zuckerberg recently announced that Llama had reached 1 billion downloads, while DeepSeek's R1 model created a stir in the AI world with its affordable pricing in January.
OpenAI has continued to capitalize on the success of its latest image-generation features in ChatGPT, with Sam Altman claiming the tool added one million users in just one hour, leading to a strain on OpenAI's graphics processing units.
OpenAI rushes for alliance with S.Korea’s Kakao
OpenAI CEO Sam Altman struck a deal with South Korea's Kakao on February 4, as the US firm seeks new partnerships following the skyrocketing rise of Chinese competitor DeepSeek.
Kakao, which operates South Korea's largest taxi-hailing app, KakaoTalk, and an online bank, revealed the collaboration, which will integrate ChatGPT into its AI services, joining a global alliance led by OpenAI amid rising sector competition.
Altman's company is part of the Stargate initiative launched by US President Donald Trump, which aims to invest up to $500 billion in AI infrastructure in the United States. But with DeepSeek, Silicon Valley has gone into a frenzy, with some calling the AI newcomer's high performance and supposed low cost a wake-up call for US developers.
"We're excited to bring advanced AI to Kakao's millions of users and work together to integrate our technology into services that transform how Kakao's users communicate and connect," Altman commented. "Kakao has a deep understanding of how technology can enrich everyday lives," he added.
