OpenAI is reportedly in talks for a share sale that would value the company at $500 billion, a figure that would surpass Elon Musk’s SpaceX. The transaction, which would increase the company’s valuation by two-thirds from its current $300 billion, involves selling shares held by current and former employees. This major financial event is reportedly being led by existing investors, including Thrive Capital, and would be a significant milestone for the ChatGPT developer.
The potential share sale is a crucial part of OpenAI’s strategy to retain top talent amidst a fierce competition. Mark Zuckerberg’s Meta has been on an aggressive hiring spree, offering massive signing bonuses to attract AI researchers. While OpenAI CEO Sam Altman has publicly stated that Meta has not poached “the best” people, a share sale provides a powerful incentive for existing staff to stay by allowing them to cash out a portion of their equity. This is a common practice for startups to keep employees motivated. The competitive landscape also includes Anthropic, a rival founded by former OpenAI employees, which is reportedly in talks for a fundraising round that could value it at $170 billion.
The high cost of training sophisticated AI models is a major driver of these fundraising efforts. OpenAI’s recent activities, including CEO Sam Altman’s teaser of the upcoming GPT-5 model and the launch of two new open-source models, highlight the immense capital required for R&D. The open-source models, which are a direct challenge to similar offerings from Meta and DeepSeek, are a strategic move to broaden the company’s influence, even as its core business relies on “closed,” proprietary models and subscriptions.
In a bold move beyond software, OpenAI recently acquired io, a startup co-founded by the legendary iPhone designer Sir Jony Ive, for $6.4 billion. This acquisition is part of a grand plan to develop a new hardware product—an AI “companion” that Altman believes will become an integral part of daily life. While the product’s mass production is not expected until 2027, this venture into hardware, along with ongoing discussions to transition to a for-profit structure, showcases a company with a long-term vision to dominate both the software and hardware aspects of the AI industry.