OpenAI Attracts $300M Investment From Top VC Firms For Widely Used ChatGPT

Key Points:

• OpenAI has attracted over $300 million in investments from venture capital firms, valuing the company at between $27 billion and $29 billion.
• The ChatGPT product has generated controversy over credibility, privacy, and potential toxicity or libel, while Dall-E and Whisper AI are other tools developed by the company.
• Microsoft has invested $10 billion, while outside investors now own more than 30% of the company, separate from Microsoft’s investment, which closed in January.

Several VC firms invested $300M in OpenAI, valuing it between $27B and $29B. The firm has faced controversy due to its ChatGPT product. Microsoft invested $10B earlier. Dall-E and Whisper AI are other tools developed by OpenAI.

Several venture capital firms have been interested in OpenAI, the startup responsible for the widely used conversational AI model ChatGPT. According to TechCrunch, documents show that investors, including Tiger Global, Sequoia Capital, Andreessen Horowitz, Thrive, and K2 Global, have invested over $300 million at a valuation between $27 billion and $29 billion. These outside investors now own more than 30%, separate from Microsoft’s earlier $10 billion investment, which closed in January.

The firm’s valuation and the rapidly developing ecosystem around its technology are key factors in the interest of investors. While Microsoft’s investment is strategic, aimed at integrating OpenAI’s tech across various business areas, venture capital firms are investing as financial backers.

OpenAI has gained significant attention for its focus on AI since its founding in 2015. However, the company has also been the subject of controversy surrounding its ChatGPT product. Critics have questioned the product’s credibility, privacy, and potential for toxicity or libel. Concerns have arisen about the future of OpenAI’s GPT branding and how “open” it will remain as more companies enter the AI development race.

OpenAI’s Dall-E, an AI-based image-generation tool, was significantly updated in July 2020. Additionally, the company has a speech recognition model called Whisper AI.

Microsoft has integrated OpenAI’s APIs with its Azure infrastructure to meet the computational needs of the models. In March, it also announced the integration of GPT-4 to improve Bing as part of its ongoing effort to compete with Google’s search services.

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