OpenAI bags $40 Billion New funding to Build Towards AGI

OpenAI has just secured a staggering $40 billion in one of the largest funding rounds ever for a private company, catapulting its valuation to an eye-popping $300 billion. This deal, finalised on April 01, 2025, shows the insatiable appetite for artificial intelligence and the towering ambitions driving its pioneers.

SoftBank Group Corp. spearheaded the investment, joined by a powerhouse roster of OpenAI’s existing supporters: Microsoft Corp., Coatue Management, Thrive Capital, and Altimeter Capital. The $300 billion valuation places OpenAI, under the leadership of CEO Sam Altman, neck-and-neck with ByteDance Ltd., TikTok’s parent, as the world’s second-most valuable private company. Only Elon Musk’s SpaceX, valued at $350 billion, stands above them, per CB Insights data.

In a succinct blog post, OpenAI outlined its vision for the funds: “continue building AI systems that drive scientific discovery, enable personalised education, enhance human creativity, and pave the way toward AGI that benefits all of humanity.” Artificial general intelligence, AGI, represents the holy grail of AI: systems that outstrip human ingenuity and intellect. It’s a prize every major player in the field is chasing.

A hefty portion of the capital, roughly $18 billion, according to a CNBC source familiar with the deal, will fuel OpenAI’s Stargate initiative. Unveiled by President Donald Trump in January, this joint venture with SoftBank, Oracle Corp., and MGX Fund Management Ltd. aims to pour up to $500 billion into AI infrastructure over the coming years. The scale of ambition here is nothing short of breath-taking.

This fundraising haul towers over historical benchmarks. Compare it to Ant Group’s $14 billion raise in 2018, Juul Labs Inc.’s $12.8 billion that same year, or DiDi Global Inc.’s $10.8 billion in 2019. Even Databricks Inc.’s $10 billion round last December pales in comparison. OpenAI’s latest move resets the bar for tech capital raises.

Negotiations for this deal stretched back to late January, reflecting its complexity. CNBC reports that OpenAI will pocket $10 billion upfront, with the remaining $30 billion contingent on a pivotal shift: becoming a for-profit entity by year’s end. Fail to deliver, and the funding could shrink by $10 billion. The clock is ticking.

OpenAI first signalled its intent to shed its non-profit roots last year, a transition requiring approval from California’s Attorney General. Complicating matters, Elon Musk, a co-founder turned adversary, is suing to block the move. The company currently operates as a hybrid, with a non-profit overseeing a capped-profit LLC. If the shift succeeds, investors can trade their convertible notes for equity in the new for-profit firm.

Investors are banking on OpenAI to dominate the generative AI market, projected by Bloomberg Intelligence to swell to $1.3 trillion by 2032. But the field is crowded, Google LLC, Microsoft, Amazon Web Services, Anthropic PBC, and Perplexity AI Inc. are all vying for supremacy. Can OpenAI sustain its edge?

Looking ahead, an initial public offering could be the next frontier if more capital is needed. Last week’s IPO by CoreWeave Inc., a hardware-focused AI player, stumbled with a 7% stock drop on Monday. Will OpenAI fare better when its time comes?

This funding round isn’t just about money, it’s a bet on a future where AI reshapes how we learn, create, and discover.