Author: Ginny Hendricksen
Last Updated: May 10, 2024
OpenAI is a privately-held AI unicorn which is leading the way in generative AI research and AI development. The company has created and released Dall.E (images), ChatGPT (large language model), and Versatile (speech). OpenAI and its AI models have become household names because of their widely applicable nature. The company’s $29 billion valuation makes OpenAI stock the most valuable artificial intelligence stock.
OpenAI was established in 2015 as a 501(c)(3) non-profit. This unusual structure was specifically chosen to support the company’s mission: to better humanity and avoid being guided by profit incentives.
CEO Sam Altman did not to invest in OpenAI stock because he wanted to avoid any conflicts of interest. Altman has asked for additional regulations for AI out of fear the intelligence would be detrimental to society.
Elon Musk invested $50 million in OpenAI and initially sat on its board. Over worries about the safety of AI, Musk severed his association with the company. Musk later founded X.ai, a competitor that creates AI specifically for X.ai’s use.
In 2019 the OpenAI changed to its structure which was limiting its ability to take in funding. OpenAI formed OpenAI GP LLC and a capped profit subsidiary, OpenAI Global LLC.
When the company launched ChatGPT in 2023, it quickly broke records for being the fastest-growing consumer app in history by MAU in the first 2 months. By comparison, Bytedance’s TikTok reached the same number of MAU over 9 months.
Yes. OpenAI is a private venture-backed company that has raised capital in 4 funding rounds. Investors usually buy preferred stock and employees are typically given common stock options or restricted stock units.
Many investors are itching to invest in AI stock given its popularity and potential for growth. In fact today, it ranks #9 on Notice.co as the most actively traded company in the secondary market.
Retail investors are not permitted to buy OpenAI stock directly through traditional brokerage accounts like publicly traded companies. Those looking to get exposure to the AI market might consider investing in ETFs which hold stock in AI, such as: Invesco AI and Next Gen Software ETF (IGPT), Roundhill Generative AI & Technology ETF (CHAT), Amplify AI Powered Equity ETF (AIEQ) and Global X Robotics & Artificial Intelligence ETF (BOTZ).
Accredited investors can learn more about OpenAI pre-IPO stock price and get access to existing shares by working with brokers on pre-IPO platforms. Reach out to top independent brokers on Notice.co.
This AI unicorn made waves in the tech industry when it managed to hit an annual run rate of $2 billion in revenue by the end of 2023. However, the company shares profits with Microsoft and costs will likely rise as OpenAI develops new models.
OpenAI has been valued at $29 billion in both of its massive recent funding rounds. You can track OpenAI private stock price live on the stock price chart above.
OpenAI's relies on Microsoft's cloud computing services to power ChatGPT. Microsoft committed to $10 billion in investments over the course of several years. Retail investors looking to own a piece of OpenAI indirectly might invest in Microsoft. Although Microsoft will be a 49% owner of OpenAI, it is in no way its parent company.
A recent OpenAI funding round brought in $300 million from top venture investors such as: Tiger Global, Sequoia Capital, Andreessen Horowitz, Thrive Capital, K2 Ventures, and Founders Fund.
Because OpenAI is a privately-held company, it does not have to disclose its financial information to the public, but it is known that OpenAI's AI/ML model is expensive.
Building ChatGPT in 2022 resulted in losses of over $500 million. However, the outlook for the company’s future profits are positive. Forecasts indicate that 2023 OpenAI revenue will be $200 million and reach up to $1 billion in revenue in 2024.
The worldwide AI industry is on track to see impressive growth and has already doubled since 2021 to $196.63 billion in 2024. The AI industry is expected to reach $1.3 trillion by 2030.
OpenAI has not yet made any announcement regarding an IPO timeline or filed a S-1 form with the SEC signaling intentions to go public.
Private companies set minimum requirements which must be met in order to qualify for an initial public offering. Official filings typically outline details around minimum market cap, gross proceeds from the share sale, and a target minimum stock price. These details for OpenAI are unknown.
OpenAI may not elect to go public soon, even if they have the money and growing market to attract IPO backing. Altman has voiced concerns around liability if the company were to go public, saying that investors might not understand or approve of decisions needed to create super intelligence.
Some experts predict that AI companies will exit earlier than other tech stocks because of the strong interest in the industry. OpenAI’s popularity may mean it will not require typical investment banking funds to go public via a traditional IPO. OpenAI may elect to launch a direct listing as instead.
The stock has no symbol associated with it yet since its stock is not publicly traded on NASDAQ or the NYSE. OpenAIÂ will appear in the Notice stock ticker if it has recent private market activity.