OpenAI has officially become the world’s most valuable private company. The company has overtaken SpaceX with a valuation of $500 billion.
The new valuation comes after a secondary share sale that allowed current and former employees to sell some of their stock. OpenAI authorized up to $10.3 billion worth of shares, but investors ended up buying $6.6 billion. Big names such as Softbank, Abu Dhabi’s MGX fund, Thrive Capital, and T. Rowe Price were part of the deal.
Bloomberg reports that this share sale boosted OpenAI’s valuation from $300 billion to $500 billion. In comparison, SpaceX is valued at $400 billion, while TikTok’s parent company ByteDance sits at around $220 billion.
In September, OpenAI announced that it was preparing to move into a new structure as a Public Benefit Corporation (PBC). This would make the company for-profit but still controlled by its nonprofit arm. The nonprofit division now owns an equity stake worth more than $100 billion, which makes it a major shareholder in the new structure.
The move has not been without controversy. Elon Musk, who co-founded OpenAI and helped fund its early operations, has been one of the strongest critics. He has filed a lawsuit against OpenAI and CEO Sam Altman, arguing that the company is straying from its original mission to build AI “for the benefit of humanity.” Musk believes the shift to a for-profit model breaks the company’s founding principles.
For OpenAI, the transition to a PBC is about money and scale. By removing the cap on investor returns, OpenAI becomes more attractive to major backers who want to profit from the AI boom. The company needs massive funding to achieve its goals. CEO Sam Altman has openly said that he intends to spend trillions of dollars building out the data centers required to run advanced AI systems.
