OpenAI is reportedly on the verge of a roughly $500 billion valuation, a determine that might make it probably the most invaluable personal firm on this planet—larger than SpaceX, TikTok’s guardian firm Bytedance, and even public giants like Palantir. It’s a staggering quantity for a corporation with an “astronomical burn rate.” How is that this even doable?
As Axios reports, there are literally two offers in play: a SoftBank-led spherical valuing the corporate at $300 billion, which received’t shut till yr’s finish, and a secondary sale of worker shares at a far steeper $500 billion valuation. Many of the cheaper shares have already been snapped up, leaving traders to battle over the pricier ones.
One OpenAI investor—who spoke on the situation of anonymity, citing an NDA—in contrast it to the daybreak of the web. “We’re in one of many greatest expertise shifts [in history],” the investor tells me. “The outcomes proceed to get larger than individuals assume.”
The investor argues the mathematics for investing on the $500 billion valuation is simple: Hypothetically, if ChatGPT hits two billion customers and monetizes at $5 per person per thirty days—”half the speed of issues like Google or Fb”—that’s $120 billion in annual income.
“That alone would assist a trillion and a half greenback firm, which is a fairly good return, simply interested by ChatGPT,” the investor says. “it does not embody all the remainder of stuff they’re engaged on, all of the enterprise stuff, all of the agentic stuff, the entire work they’re doing on {hardware}.”
Trillions of {Dollars}
The $5 determine is, admittedly, again of the envelope math. In the present day, ChatGPT has 700 million weekly energetic customers—and fewer than 10 percent pay (OpenAI declined to touch upon this determine). The investor’s projections are bold, and appear to low cost the specter of main gamers like Google and Meta consuming OpenAI’s lunch. “The half a trillion greenback query now could be, to what extent will OpenAI be capable of retain the shoppers that it has acquired, and concurrently be capable of carry its prices to a degree the place it will possibly, in actual fact, monetize at [hypothetically] $5 per person per thirty days,” says Arun Sundararajan, a professor at New York College’s Stern Faculty of Enterprise.
The guess right here is that OpenAI is the subsequent Fb or Google. For traders shopping for in at $500 billion, “they’re anticipating an IPO above a trillion in two to a few years, in any other case the speed of return doesn’t justify the funding,” says Glenn Okun, who’s additionally a enterprise professor at NYU. That might imply leaping into the highest ten most useful public firms on this planet virtually in a single day. The investor says they’ve an extended time horizon than that, however “after all an IPO is probably the most wise path given the size of the corporate.” Although the investor admits, sure, the corporate would have to be valued at greater than $1 trillion to make the funding worthwhile.
Stranger issues have occurred—significantly to OpenAI. Within the first seven months of 2025, the corporate doubled its projected annual income to $12 billion, which might estimate OpenAI is bringing in about $1 billion per thirty days. Enterprise adoption has surged too, reaching 5 million paying enterprise customers this month. To not point out what potential advertising revenue might do to its backside line. To the investor, these are indicators of an organization with the momentum to win: “Individuals don’t love unprecedented issues, as a result of most individuals prefer to sample match,” the investor says. “Every little thing this firm has completed has been unprecedented from the tempo of its income development to the AI expertise.”