OpenAI’s investors include Tech’s most prolific Bubble-Chasers

• OpenAI raises $6.6 billion in deal that values ​​company at more than $150 billion
• Investors include Nvidia, Thrive Capital and a UAE-backed investment firm.
• Backers also include SoftBank, Tiger Global and the Ark Venture fund, which have a track record of leading investments.

OpenAI has officially closed a historic funding round. The company raised $6.6 billion in a deal that valued the company at more than $150 billion and brought in a host of high-profile investors, including Nvidia, Thrive Capital and MGX, an UAE-backed investment firm United.

However, some of the firms participating in the round are renowned less for their business acumen and more for being some of Silicon Valley’s most prolific bubble chasers.

Among them was SoftBank, which is famous poured $18.5 billion into WeWorksupporting founder Adam Neuman to the end, even as he left the company in disappointment and raised more than a billion dollars at the exit.

SoftBank CEO Masayoshi Son, known for his distinctive shoot-from-the-hip investing style, is said to have he told Neuman that he “wasn’t crazy enough.” SoftBank has a history of big bets that never paid off, such as robotic pizza-making startup Zume that fizzled. 445 million dollars before going bankrupt. SoftBank’s vision fund saw massive losses in 2023 and more recently it was sale or cancellation of assetslaying off employees and slowing the pace of new investment.

Tiger Global is also among the firms supports OpenAI in this latest round of funding. In 2021the firm led the charge on so-called crossover funds, a group of investors who flooded Silicon Valley with money from Wall Streettriggering a frenzy of deals and driving startup valuations to unsustainable levels. But the strategy of bombarding start-ups with bomb money ultimately backfired when valuations fell in 2022, leaving the fund overextended and with painful losses.

A partner at a top venture capital firm told Business Insider, “The (OpenAI) funding feels very 2021,” referring to the venture capital frenzy that year that produced a slew of overvalued deals.

Cathie Wood’s Ark Venture Fund doubles its investment in maker ChatGPT, as first reported by Business Insider. Ark has the ignominious distinction of being the greatest destroyer of wealth from the last decade, losing over 14 billion dollars with its monthly bets on everything from genomics to cryptocurrencies, according to Morningstar.

You’d be forgiven for wondering if these investors’ proven track record of coming out on top is a poor indicator of OpenAI’s ability to grow to its staggering valuation. The company, which two years ago was a relatively unknown research collective, is now officially worth as much as Goldman Sachs or AT&T. That’s either wildly optimistic or wildly pessimistic, depending on who you ask.

Notably absent from the list of OpenAI investors was Apple, which is rumored to have reneged on the deal at the 11th hour. This comes just months after the two companies announced a partnership to integrate OpenAI technology in Apple devices. One can’t help but wonder why Tim Cook would be willing to put ChatGPT in the hands of Apple’s billions of users, but wouldn’t want to invest in the company that makes it.

Cook has, rightly or wrongly, developed a reputation in Silicon Valley as a stable and reliable counterweight to Elon Musk and his ilk. Apple’s inclusion in OpenAI’s funding round may have gone a long way in alleviating doubts about OpenAI. hot palace intrigue and a general chaotic atmosphere.

A few weeks ago this funding round was being talked about as the arrival of adults in the gym. It looks like it could have ended with some rambunctious teenagers.