SoftBank invests $1.5B in OpenAI through employee share buyout

OpenAI, the company behind ChatGPT, has secured a $1.5 billion investment from SoftBank Group through a tender offer.

This deal allows current and former OpenAI employees to cash out restricted stock units at $210 per share, providing liquidity in a market with limited IPO opportunities for tech firms.

According to CNBC, the investment was led by SoftBank CEO Masayoshi Son, who has expressed ongoing interest in increasing the conglomerate's stake in OpenAI.

The funding strengthens OpenAI’s financial resources for further advancements in artificial intelligence while offering its stakeholders liquidity.

SoftBank's investment aligns with its broader AI-focused strategy.

In October, the company participated in a $6.6 billion funding round for OpenAI, and in July, it invested in an AI firm developing general-purpose brains for robotics.

OpenAI has recently faced challenges, including the leak of its unreleased Sora text-to-video tool by beta testers.

The testers accused OpenAI of exploiting unpaid labor and failing to recognise contributions.

The company shut down access to the tool, fueling ongoing discussions about ethics in AI development.

In addition, OpenAI was recently cleared of a copyright lawsuit filed by news outlets alleging the misuse of articles in training ChatGPT.

While a U.S. federal judge dismissed the case for insufficient evidence, the plaintiffs plan to refile with additional documentation to address the court’s concerns.

The $1.5 billion tender offer underscores the growing interest in AI technology and supports OpenAI’s efforts to expand its capabilities while navigating ethical and legal challenges.