Artificial intelligence Startups

Microsoft Agrees To Multibillion-Dollar Deal With OpenAI

Illustration of paper airplane made from money

Microsoft confirmed Monday it has agreed to a “multiyear, multibillion-dollar investment” into OpenAI, the startup behind the artificial intelligence tools ChatGPT and DALL-E.

The deal has been rumored for weeks. While the exact dollar amount was not confirmed, Semafor reported earlier this month that Microsoft was in talks to invest as much as $10 billion.

The deal follows a $1 billion investment in 2019 from Microsoft into the AI startup. That deal made Microsoft’s Azure the exclusive provider of cloud computing services to OpenAI. 

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“We formed our partnership with OpenAI around a shared ambition to responsibly advance cutting-edge AI research and democratize AI as a new technology platform,” said Satya Nadella, chairman and CEO of Microsoft. “In this next phase of our partnership, developers and organizations across industries will have access to the best AI infrastructure, models and toolchain with Azure to build and run their applications.”

Microsoft is in a battle for AI dominance with other tech giants such as Alphabet and Amazon.

Big money for AI

Earlier this month The Wall Street Journal reported the startup could be valued at $29 billion thanks to a new tender offer.

Venture firms Thrive Capital and Founders Fund were reported to be in talks to invest in the offer that would have allowed them to buy shares from existing OpenAI shareholders.

OpenAI had been valued at $14 billion during a tender offer in 2021.

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Illustration: Dom Guzman

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