OpenAI has scaled back its latest fundraising, now seeking up to about $20 billion instead of roughly $30 billion, after a sharp selloff in technology stocks led some investors to cut the amounts they were willing to commit, according to people familiar with the round.
The ChatGPT developer is also accepting a lower price. The round values the company at about $1.25 trillion after the new money, down from roughly $1.4 trillion discussed earlier, the people said. OpenAI set an Oct. 30 deadline for commitments, and the first close is expected to raise less than $20 billion. The round remains open and its terms could still change.
Gulf money leads
A consortium of investors from the United Arab Emirates, including the state-backed technology fund MGX, is expected to be the largest participant, with Coatue co-leading. As part of the arrangement, OpenAI would gain an option to lease new computing capacity in the region. Venture firms Founders Fund, Sequoia Capital and Andreessen Horowitz are also expected to take part, and wealthy individuals would be able to buy in later through a retail offering at the same valuation, the people said.
Bad timing
The cut follows a rough week for AI-linked stocks. The Nasdaq Composite fell 2.9% on Oct. 30 and ended the day 7.8% below its Oct. 6 record. Intel tumbled after issuing weak guidance, and investors questioned whether the hundreds of billions of dollars that Microsoft, Alphabet and Amazon are spending on data centers will earn adequate returns.
OpenAI, which is preparing for a stock-market listing in 2027, has been pushing to finish the round partly to get ahead of rival Anthropic, which filed publicly for its own IPO last week and draws on much the same pool of investors. Other large AI rounds have also stretched out: Canada’s Cohere disclosed only an initial close of its Series E last week.
