OpenAI races to raise about $30B before Anthropic IPO, targeting $1.4T-plus valuation

OpenAI is moving to lock in new investor commitments before rival Anthropic lists on the public market, in a round that could value the ChatGPT maker at more than $1.4 trillion.Round of about $30 billionThe company is seeking roughly $30 billion, one of the sources told Reuters. Existing backers, including Japan's SoftBank Group and Abu Dhabi-based MGX, are in talks to participate. Anthropic is widely expected to make its market debut in mid-November, and the timeline for OpenAI's raise is faster than is usual for a deal of this size, the report said.SoftBank and OpenAI declined to comment. Anthropic and MGX did not immediately respond to Reuters' requests.A race for the same investorsThe sources said OpenAI is keen to move first because the two AI labs are courting a largely overlapping pool of investors. OpenAI met long-only funds and sovereign wealth funds last week, the same period in which Anthropic held its own investor day.Some investors see the push as a bid to secure money from funds that might otherwise put more of their capital into Anthropic's offering, Reuters reported. With both companies chasing trillion-dollar valuations, investors face the task of weighing two complex deals within days or weeks of each other.An OpenAI Agent Stole Funds From A Crypto Wallet It Did Not Own To Finish A TaskGrowth pitch and pricingOpenAI is telling investors that growth picked up after it released its GPT-6 Astra model. According to one source, the company says it has reached $50 billion in annualized revenue and expects to hit $70 billion by the end of the year. It has also cut prices on its lower-cost models, which it says has lifted usage, and has indicated it could reduce prices further.Avoiding a direct comparisonTiming also matters because Anthropic's IPO filings will open its books to scrutiny. One source told Reuters OpenAI wants to finish raising before those disclosures give investors a clearer view of Anthropic and invite side-by-side comparisons.Such comparisons could lead investors to press OpenAI Chief Financial Officer Sarah Friar on its revenue growth and outlook. The two companies also account for revenue differently. OpenAI books revenue net, deducting partners' shares up front, and has accused Anthropic of overstating its numbers by counting the full value of contracts sold through third-party cloud providers. OpenAI Accuses Ex-Employee Now At Apple Of Taking Files On Unreleased Device Edward Best, co-chair of capital markets at law firm Willkie Farr & Gallagher, who is not involved in the deal, said OpenAI may want to set its valuation without a peer benchmark, calling the contest a "two-horse race" to go public.Anthropic's numbers and valuation debateReuters has previously reported that Anthropic's annualized revenue reached about $65 billion by July. The company told investors its quarterly revenue rose to $16.8 billion in the third quarter from $11.6 billion in the second. Slowing month-on-month growth, however, has raised questions about its valuation.Some current and prospective Anthropic investors have argued for a debut valuation nearer $1.5 trillion rather than the $2 trillion the company wanted, after third-quarter results fell short of expectations, Reuters reported last week.OpenAI's funding history and IPO plansOpenAI was last valued at $852 billion in March, following a record $122 billion round that included a commitment from Amazon to invest up to $50 billion. Investors familiar with the company say it needs fresh capital to fund heavy infrastructure commitments and shore up its balance sheet if weaker IPO markets push back its planned 2027 listing.

New York: OpenAI is racing to secure investor commitments before rival Anthropic's expected public market debut in mid-November, in an unusually fast fundraising that could value the ChatGPT maker at over $1.4 trillion, according to two people familiar with the matter.The rapid timetable reflects, in part, a desire to get ahead of Anthropic as the two frontier labs are increasingly tapping in to a similar investor base, the people said, adding that OpenAI wants to capitalize on its recent revenue growth after launching new models. SoftBank Group, Abu Dhabi-based MGX and other existing backers of OpenAI are in talks to join the round of about $30 billion, one of the people said.Also read: Ex-OpenAI employee accused of planting device appears to have Saudi backing: court filingThe acceleration underscores how closely the two AI developers are competing for capital as both pursue trillion-dollar price tags, amid growing concern about rising interest rates, significant volatility in technology stocks and rising scrutiny of AI valuations.OpenAI held meetings with long-only funds and sovereign wealth funds last week while Anthropic was hosting its own investor day. OpenAI's funding round is expected to move faster than is typical for an offering of its size, the people said.Investors familiar with the company say OpenAI also needs capital to fund its substantial infrastructure commitments and bolster its balance sheet if a deterioration in the IPO markets further delays its planned 2027 listing.Though there is high demand for the shares of both companies, investors face the challenge of evaluating and allocating capital to two complex, competing offerings within days or weeks of each other. Some investors view OpenAI's financing push as an effort to lock in capital from funds that might otherwise devote more of their resources to Anthropic's IPO, the people said.OpenAI and SoftBank declined to comment. Anthropic and MGX did not immediately respond to requests for comment.TRYING TO HEAD OFF COMPARISONSOpenAI is pitching investors on growth that accelerated after the launch of its GPT-6 Astra model, saying it had reached $50 billion in annualized revenue and expecting that figure to rise to $70 billion by year-end, according to one of the people.OpenAI has also cut prices on its cheaper models, which it said has boosted usage, and told investors it can further lower the price of AI models, the person added.Anthropic's annualized revenue reached roughly $65 billion by July, Reuters previously reported. Its quarterly revenue jumped to $16.8 billion in the third quarter from $11.6 billion in the second quarter this year, it told investors, but slowing month-to-month revenue growth has raised concerns among investors about its valuation.OpenAI is seeking to complete the fundraising before Anthropic's financial disclosures give investors a fuller picture of its business and invite comparisons between the two companies, one person said.Also read: OpenAI’s IPO dream may shatter with sistress sale to MSThe disclosures could prompt investors to press OpenAI Chief Financial Officer Sarah Friar for more details about the company's revenue growth and financial outlook, the person added. OpenAI records revenue on a net basis by subtracting partner shares upfront. It has accused Anthropic of inflating its revenue by counting the full, gross value of contracts sold through third-party cloud providers. Anthropic told Reuters earlier that it follows established accounting practices."OpenAI could want to set its own valuation and not have to worry about a comp (comparison)," said Edward Best, co-chair of capital markets at Willkie Farr & Gallagher, who is not working on the deal and commented on a hypothetical basis. "It's really a two-horse race in terms of being public."OpenAI was last valued at $852 billion in March this year, after a record-breaking $122 billion funding round, including a commitment from Amazon.com, which agreed to invest up to $50 billion in the lab.The Financial Times previously reported some details of OpenAI's potential fundraising.IPO PLANS HIT BY MARKET JITTERSA number of companies preparing to go public have decided to wait until after Anthropic's planned IPO, wary of competing for investor demand amid market volatility and a pullback in AI stocks, bankers and investors said. Some late-stage companies are also timing private fundraising rounds to avoid coinciding with Anthropic's expected debut, the bankers and investors said.Some existing and prospective Anthropic investors have argued for a valuation closer to $1.5 trillion for its market debut - instead of the desired $2 trillion - after the AI startup's third-quarter results fell short of expectations, Reuters reported last week.The reassessment comes amid a choppy market since September, with volatility in oil prices, rising bond yields and growing concerns about AI safety weighing on investor appetite for technology stocks. Investors are also scrutinizing the cost of AI infrastructure, including the debt needed to finance the data centers powering the boom.At the center of the latest concerns is cloud provider CoreWeave, whose shares and debt tumbled last week as investors scrutinized the nearly $50 billion in borrowings used to fund its rapid expansion.The uncertainty has disrupted what had been expected to be a busy autumn for IPOs, with companies reassessing their listing plans amid market volatility and concerns about valuations. Blackstone-backed AirTrunk REIT, Nvidia -backed Firmus and SoftBank-backed SB Energy have either pulled or paused their listings.Nuclear services company Holtec cited a "perfect storm," driven mainly by uncertainty around data-center demand, ​when it pulled its US listing last month.Companies in the Philadelphia Semiconductor Index, widely viewed as a proxy for AI-related semiconductor demand, have shed $1.6 trillion in less than two weeks, while AI infrastructure companies have come under particular pressure.

Will the AI bubble burst?  That’s the question on investors’ minds when an AI company announces anything from a rogue agent to an earnings report.  Sure, AI companies continue to increase their revenue, but one lesser discussed metric has investors scared: a slowing growth rate.  “A handful of AI-linked companies have driven much of the stock market’s gains recently, so any wobble here can ripple through retirement accounts and index funds broadly, not just tech investors,” says Sameer Samana, an adviser and head of global equities and real assets at the Wells Fargo Investment Institute. Take Anthropic, which shared its third-quarter results with current and prospective investors on Wednesday, October 14. The company announced that its revenue rose 45% to $16.8 billion, up from $11.6 billion in the previous quarter, CNBC reported.In theory, it sounds like a successful result, but looking at the bigger picture, it signals a potential slowdown. Anthropic’s revenue had previously risen nearly 60%—from $4.7 billion to $11.6 billion—between quarters one and two. Yet, the first quarter still beat the entirety of 2025. Anthropic reported $4.6 billion in revenue for the year and $386 million in revenue for 2024, according to Morningstar. The declining growth rate marks a change for AI companies. “Investor expectations had been getting increasingly optimistic and hoping for ‘fast growth and getting faster.’ Now it’s just ‘fast,’” Samana says. “AI companies are still growing quickly, but not at the eye-popping pace investors had come to expect—and stocks were priced for that pace to continue.”  OpenAI’s revenue forecast drops OpenAI is among the companies causing concern. At the end of September, sources told Axios that OpenAI’s annualized recurring revenue was close to $70 billion. Then, on October 8, reports emerged that the company had revised that number, cutting it by $20 billion. In reporting the shift, the publication said the initial figure was due to the fact that AI companies have distinctive ways of counting sales. OpenAI wanted to directly compare itself with Anthropic.  “It seems counterintuitive to worry about companies generating billions in revenue, but in financial markets, valuations are driven by the rate of change, not just absolute revenue,” says Adam Coons, chief investment officer and portfolio manager at Winthrop Capital Management. “Investors aren’t paying for today’s sales; they’re paying for years of hypergrowth to come. When that growth rate slows, even from extraordinary levels, it changes the math behind both the valuations and the debt-financed build-out that depends on them.” In addition to the discrepancy, annualized recurring revenue is nothing more than a prediction, one that is commonly used by Silicon Valley but can be inaccurate. Investors can’t rely on it alone for growth indicators.  Competition can slow revenue growth Samana and Coons both point to competition as a potential reason for slower growth. “Competition is driving prices down,” Samana says. “More AI companies are competing for customers, so even as more people use AI, the money each company makes per customer is shrinking.”   OpenAI might have started the current AI era with the launch of ChatGPT, but it now has to contend with a number of competitors. “With open-source models such as Meta’s Llama and a wave of Chinese models closing the capability gap, and OpenAI, Anthropic, and Google competing aggressively on price, the cost of digital intelligence is falling fast,” Coons adds. “When models converge in capability, pricing power evaporates, and revenue growth and margins can shrink at the same time.” Anthropic’s IPO valuation sinks These declining growth rates can scare away investors. Some investors in attendance at last week’s meeting are now leaning toward an initial public offering (IPO) valuation of $1.5 trillion for Anthropic, down from $2 trillion, Reuters reports.  Anthropic submitted its initial filing to the Securities and Exchange Commission (SEC) in June. The company has since pushed its IPO plans from October to November, a move that left time to share its latest results.  Reuters also viewed Anthropic’s IPO prospectus in which the company planned to warn investors that AI could have “catastrophic or existential risks to humanity.” But slower revenue growth isn’t the only notable part of Anthropic’s finances. The prospectus revealed that Anthropic’s operating loss rose from $2.98 billion in 2024 to $8.06 billion in 2025. The company had $12.65 billion in total operating expenses for 2025, $7.33 billion of which was spent on computing and infrastructure—three times the amount it spent the year before.  Overall, Anthropic had a net loss of $42 billion in 2025, up from just over $8 billion in 2024. According to the prospectus, $34 billion of its net loss was due to an accounting charge.  A week after that news broke, New Constructs called Anthropic’s IPO “an unprecedented test of investor gullibility.” The independent research technology firm warned investors to avoid the IPO, citing “gargantuan risks” such as Anthropic’s rising net losses. As Samana puts it: “These companies bet big—with borrowed money. Many committed to massive spending on chips and data centers, assuming growth would stay sky-high. Slower growth makes those bets riskier.”