OpenAI’s Relationship with Microsoft and Potential IPO Insights
OpenAI, the developer of ChatGPT, is currently not a publicly tradable company. However, Microsoft (NASDAQ: MSFT) owns approximately 27% of OpenAI, based on a recent legal resolution regarding ownership. As of March, OpenAI’s valuation stood at around $852 billion following a raise of $122 billion, making Microsoft’s stake worth approximately $230 billion. This accounts for nearly 10% of Microsoft’s market capitalization of $2.8 trillion.
Analysts predict that OpenAI may need to go public soon due to the challenges of securing additional private funding at such high valuations. While there is no confirmed IPO date, speculation suggests it could occur later this year or in 2024 as the company explores further infrastructure expansion and capital acquisition. Microsoft’s share includes significant potential returns from its investment in OpenAI, which currently operates at a deficit.
