Mind your large language

OpenAI reckons it’s worth $100bn. Is it?

OpenAI, the company behind ChatGPT, wants to raise more capital. The artificial intelligence (AI) firm’s got bills it's gotta pay. It needs to buy more computer chips, hire coders, and write huge cheques for electricity. It also wants to expand the capacity of its large language models which understand and create text. The firm last raised money in January 2023 at a $29bn valuation—an eye watering sum. Yet, the current ask will gobsmack the pundits who saw even that price as a stretch.

According to a report from the Wall Street Journal, the firm's bosses want to sell shares to private investors at a $100bn valuation. And they'll get it, too. Thrive Capital, a venture capital firm, plans to invest $1bn. At the same time, Microsoft, OpenAI's largest outside investor, will also pony up. So, is OpenAI worth $100bn? The underwhelming answer is maybe. That valuation is generous but not insane.

There are bold assumptions about the firm's market share and profits baked into the $100bn price tag…