OpenAI is reportedly on the verge of a roughly $500 billion valuation, a determine that might make it essentially the most worthwhile non-public firm on this planet—larger than SpaceX, TikTok’s father or mother firm Bytedance, and even public giants like Palantir. It’s a staggering quantity for a corporation with an “astronomical burn charge.” How is that this even potential?
As Axios stories, there are literally two offers in play: a SoftBank-led spherical valuing the corporate at $300 billion, which received’t shut till 12 months’s finish, and a secondary sale of worker shares at a far steeper $500 billion valuation. A lot of the cheaper shares have already been snapped up, leaving buyers to combat over the pricier ones.
One OpenAI investor—who spoke on the situation of anonymity, citing an NDA—in contrast it to the daybreak of the web. “We’re in one of many largest know-how shifts [in history],” the investor tells me. “The outcomes proceed to get larger than individuals assume.”
The investor argues that the maths for investing on the $500 billion valuation is simple: Hypothetically, if ChatGPT hits 2 billion customers and monetizes at $5 per person monthly—“half the speed of issues like Google or Fb”—that’s $120 billion in annual income.
“That alone would assist a trillion-and-a-half-dollar firm, which is a reasonably good return, simply desirous about ChatGPT,” the investor says. “It would not embrace all the remainder of the stuff they’re engaged on, all of the enterprise stuff, all of the agentic stuff, all the work they’re doing on {hardware}.”
Trillions of {Dollars}
The $5 determine is, admittedly, back-of-the-envelope math. At the moment, ChatGPT has 700 million weekly lively customers—and fewer than 10 p.c of them pay for it.(OpenAI declined to touch upon this determine.) The investor’s projections are bold, and so they appear to low cost the specter of main gamers like Google or Meta consuming OpenAI’s lunch. “The half-a-trillion-dollar query now’s, to what extent will OpenAI be capable of retain the purchasers it has acquired, and concurrently be capable of deliver its prices to a degree the place it might, the truth is, monetize at [hypothetically] $5 per person monthly,” says Arun Sundararajan, a professor at New York College’s Stern College of Enterprise.
The wager right here is that OpenAI is the subsequent Fb or Google. For buyers shopping for in at $500 billion, “they’re anticipating an IPO above a trillion in two to 3 years, in any other case the speed of return doesn’t justify the funding,” says Glenn Okun, who’s additionally a enterprise professor at NYU. That might imply leaping into the highest 10 most useful public firms on this planet virtually in a single day. The investor says they’ve an extended time horizon than that, however “in fact an IPO is essentially the most wise path given the dimensions of the corporate.” Although the investor admits, sure, the corporate would should be valued at greater than $1 trillion to make the funding worthwhile.
Stranger issues have occurred—significantly to OpenAI. Within the first seven months of 2025, the corporate doubled its projected annual income to $12 billion, which suggests OpenAI is bringing in about $1 billion monthly. Enterprise adoption has surged, too, reaching 5 million paying enterprise customers this month. To not point out what potential promoting income might do to its backside line. To the investor, these are indicators of an organization with the momentum to win: “Individuals don’t love unprecedented issues, as a result of most individuals wish to pattern-match,” the investor says. “All the pieces this firm has performed has been unprecedented, from the tempo of its income development to the AI know-how.”
