OpenAI Files for IPO as Competition with Anthropic Heats Up
In Focus
- OpenAI is reportedly seeking a $1 trillion valuation through the IPO
- The IPO will likely test investor appetite for high-growth tech stocks
- OpenAI filed for IPO a week after Anthropic
OpenAI filed a confidential application for an IPO in the U.S. on June 8. The IPO filing sets the stage for one of the most anticipated trillion-dollar valuation market debuts in recent years.
Elon Musk’s SpaceX was among the first companies to do this after its IPO filing was considered the largest in history. The rocket maker is seeking to raise $75 billion at a $1.75 trillion valuation.
What Valuation is OpenAI Seeking With the Public Listing?
The ChatGPT maker did not state the terms of its offering. However, the AI developer had placed its post-money valuation at $852 billion in March this year. OpenAI is reportedly targeting a $1 trillion valuation through the IPO.
With such a valuation, OpenAI’s IPO will test investor appetite for high-growth tech stocks in recent times. OpenAI also said it has yet to decide on the timing because “there are things we want to do that are likely easier as a private company.”
OpenAI’s stock market listing comes soon after Anthropic pushed toward public listing as investors seek to capitalize the AI boom. Anthropic submitted its confidential IPO filing to the Securities Exchange Commission last week. The Claude Code maker’s last valuation was $965 billion, making it the most valuable AI firm in the world.
What Does OpenAI’s IPO Mean for the AI Industry?
Most analysts expected OpenAI to file for an IPO before Anthropic. The IPOs by the two firms represent a significant milestone in the AI boom and reflect the growing influence of AI technology on global markets.
Early this year, OpenAI sought to raise $110 billion at an $840 billion valuation from a range of backers, including Nvidia and Amazon. During this period, the company said it had clocked over 900 million weekly active users. OpenAI also said that it had more than 50 million paid subscribers.
OpenAI filed for the U.S. IPO soon after it renegotiated its partnership with Microsoft, which is one of its initial backers. Under the latest agreement, the AI firm can establish new partnerships with tech companies such as Google and Amazon.
Microsoft has invested $13 billion in OpenAI since 2019, supporting its rapid rise in the industry. The partnership with OpenAI powered the growth of Microsoft’s cloud computing business, Azure. Microsoft holds a 27% stake in the OpenAI Group after the two companies restructured their partnership last year.
Competition Between OpenAI and Anthropic
The AI industry is increasingly becoming competitive. OpenAI faces stiff competition from Anthropic, whose dominance in enterprise AI continues to grow. The demand for Claude AI has grown significantly among software developers.
Demand for Claude Mythos is also rising among enterprises due to its ability to identify software flaws. While OpenAI’s IPO could excite investors, some bankers warn that the listing might absorb capital that otherwise have flown to smaller deals.
