OpenAI Backers Question Valuation Amid Anthropic Competition

OpenAI’s $852 billion valuation is reportedly causing some unease among the startup’s own investors.

As the Financial Times (FT) reported Tuesday (April 14), this growing scrutiny comes amid OpenAI’s new focus on enterprise customers and dealing with competition from rival artificial intelligence (AI) startup Anthropic.

In the past few months, OpenAI has made a series of moves to further a new strategy, one that involves sustaining ChatGPT’s place as the dominant consumer AI product, while also competing with Anthropic for corporate customers.

However, some OpenAI investors say these changes could leave the company vulnerable to Anthropic and Google as it prepares to go public.

“You have ChatGPT, a 1 billion-user business growing 50-100 per cent a year, what are you doing talking about enterprise and code?” one early investor in OpenAI told the FT. “It’s a deeply unfocused company.”

The report added that OpenAI leadership remains confident, having already gone through numerous successful pivots. CEO Sam Altman last month landed $122 billion in funding from high-profile investors that included SoftBank, Amazon and Nvidia.

“The suggestion that investors are not supportive of our strategy defies the facts,” said Sarah Friar, OpenAI’s chief financial officer. “Our . . . raise, the largest in history, was oversubscribed, completed in record time and backed by a broad set of global investors, reflecting strong conviction in both our direction, current business momentum and long-term value.”

The report also includes a comment from an investor who has backed both OpenAI and Anthripic, who said that to underwrite an investment in OpenAI’s recent round, they would have to assume an IPO valuation of at least $1.2 trillion.

That has become harder to defend considering the cheaper proposition of buying into Anthropic, most recently valued at $380 billion, the FT said. The investor added that OpenAI was in danger of being left “in no man’s land.”

Writing about competition between the various AI platforms last week, PYMNTS CEO Karen Webster argued that this race will be determined more by how user habits are formed than by product releases, and by “whether the platforms understand that they aren’t just competing for users, but for the order in which those users show up at their prompt.”

“The consumer who opens ChatGPT before she’s had her coffee isn’t likely to be pulled away by a better feature set alone,” Webster added. “If she changes her behavior at all, it will be because another model earns a specific role in her routine.”