San Francisco-based AI startup OpenAI concluded a tender offer, allowing workers to liquidate their employee profit units by selling them to investors, sources told The Information.
An earlier WSJ report estimated the value of the tender offer to be nearly $300M. The company's implied valuation during the tender offer was close to $27B based on the share prices.
- Investors will purchase profit units from employees, which guarantees them rights to future profits made by OpenAI.
- In January earlier this year, VC firms Thrive Capital and Founders Fund were reportedly in talks to buy shares through the tender offer at a $29B valuation.
- The profit-sharing structure of the units changed recently after OpenAI received a multi-billion dollar investment from Microsoft in January 2023.
- The deal gives Microsoft a right to 75% of OpenAI's profits until its principal investment is paid back, after which it will split the profits with employees and investors.
- OpenAI expects to rake in $200M in revenue in 2023 and $1B in 2024.
- In 2021, Sequoia Capital, Bedrock Capital, and Andreessen Horowitz acquired stakes in OpenAI through a secondary offering at an implied valuation of around $20B.
