OpenAI raises record $110 billion from Amazon, NVIDIA, and SoftBank to boost AI

OpenAI, the company behind ChatGPT, just closed the largest private funding round in tech history, $110 billion from Amazon, NVIDIA, and SoftBank.

The deal values the company at $840 billion, up from $500 billion in October. Amazon is putting in $50 billion, while NVIDIA and SoftBank are each investing $30 billion. The round is still open, and more investors are expected to join.

Sam Altman, OpenAI’s CEO, announced the funding on Friday, saying the company is “grateful for the support from our partners” and has “a lot of work to do to bring you the tools you deserve.”

Why OpenAI needs this much money

OpenAI burns through cash fast. Training AI models requires massive computing power, which means buying thousands of high-end chips and renting enormous amounts of server capacity.

The company is spending heavily on data centres to keep ChatGPT running and to build more advanced AI systems.

The funding also comes as competition intensifies. Google’s Gemini and Anthropic’s Claude are challenging ChatGPT’s dominance, and it needs resources to stay ahead.

The company has over 900 million weekly active ChatGPT users and 9 million paying business customers, but maintaining that lead requires constant investment.

Amazon’s $50 billion investment comes in two stages: $15 billion immediately, and another $35 billion in the coming months once OpenAI meets certain conditions. Reports suggest those conditions could include reaching artificial general intelligence (AGI) or completing an IPO by year-end.

What each partner gets

Amazon isn’t just writing a check. The companies are expanding their cloud partnership by $100 billion over eight years. OpenAI will use Amazon Web Services infrastructure, including Amazon’s custom Trainium AI chips, and AWS becomes the exclusive third-party cloud provider for its enterprise platform.

The company will also build custom AI models specifically for Amazon’s products and engineering teams. Amazon CEO Andy Jassy said the partnership will “change what’s possible for customers building AI apps and agents.”

NVIDIA’s $30 billion investment strengthens ties between the chip maker and one of its largest customers. OpenAI is committed to using 3 gigawatts of dedicated inference capacity and 2 gigawatts of training on NVIDIA’s Vera Rubin systems.

The companies didn’t clarify whether this replaces NVIDIA’s previously announced commitment to invest up to $100 billion.

SoftBank is returning as a major investor after leading OpenAI’s last $40 billion round. Altman called SoftBank “an incredible and high-conviction partner” and said they’re excited to do more across SoftBank’s ecosystem.

Notably, Microsoft didn’t participate in this round, but both companies stressed that their partnership continues. The company reportedly has the option to join later if it chooses. It has been OpenAI’s biggest backer since 2019, investing over $13 billion before this round.

The funding sets OpenAI up for an expected IPO later this year, which would be one of the biggest tech public offerings in history.

For context, the entire U.S. venture capital industry invested $170 billion across all startups in 2023. OpenAI just raised more than half that amount in a single round.

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