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OpenAI Raises 11 Billion Dollars at a 1.25 Trillion Dollar Valuation, and the Market Is Blinking

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  • OpenAI Raises 11 Billion Dollars at a 1.25 Trillion Dollar Valuation, and the Market Is Blinking
Photograph of OpenAI CEO Sam Altman seated on stage during a TED talk.

OpenAI has reportedly raised 11 billion dollars so far in a new funding round that values the company at 1.25 trillion dollars, Bloomberg reported on Friday, in a story carried by TechCrunch on November 6. The round has not closed yet. It is expected to close in the coming weeks and could total about 20 billion dollars, according to a source familiar with the matter. TechCrunch said it had reached out to OpenAI for comment. Even at a trillion-dollar-plus valuation, the striking part of the report is not the size of the number. It is the direction it moved.

In late September, Bloomberg reported that OpenAI was looking to raise 30 billion dollars in this round. The current figures fall well short of that target, and separate reporting on Friday said OpenAI had lowered its proposed valuation to 1.25 trillion dollars from 1.4 trillion dollars and cut its fundraising goals by about 10 billion dollars. Its chief rival is seeing the same repricing. Bloomberg also reported on Friday that potential buyers of shares in Anthropic's upcoming public offering are eyeing a substantially lower valuation than the company had targeted, with some buyers seeing it as low as 1.1 trillion dollars, compared with the 2 trillion dollars investors were said to expect roughly a month ago.

New spending data helps explain the blink. A report from Ramp, also covered by TechCrunch on November 6, found that business spending on AI tokens grew only 1.5 percent across August and September, after growing 42 percent in July, even as token volumes kept rising. Ramp's lead economist, Ara Kharazian, pointed to price competition rather than weak demand. OpenAI halved API prices for GPT-6 Sol and GPT-6 Luna in September, and Anthropic has cut prices for Fable 5.1 and Opus 5.5, a move the company said in a recent filing reduced revenue growth by about 600 million dollars. Median firms spend only 12 to 15 dollars per employee per month on AI, Ramp found, while the top 10 percent spend 600 to 1,000 dollars. Spending did re-accelerate in October, rising 8.9 percent from September 23 to October 23, but the hypergrowth assumption is clearly under pressure.

The politics have shifted at the same time. TechCrunch noted that the Democratic landslide in this week's United States midterm elections, and strongly negative voter sentiment around data centers, has caused jitters across the market, with further regulatory challenges expected. OpenAI had previously suggested it would go public this year, then delayed those plans, and an initial public offering is now expected at some point next year. None of this amounts to a collapse. A company raising 11 billion dollars at a 1.25 trillion dollar valuation is still operating at a scale no software business has reached before. What has changed is that investors are now asking what the revenue underneath that valuation actually does next.

For people building with AI, this is mostly good news, and it should be used. A buyer's market means the price war is real, routing work to cheaper models pays, and no business case should be built on today's list price or on the assumption that a single provider's growth curve justifies lock-in. The labs still need enormous amounts of capital for compute, and they will keep competing for developers while they raise it. The practical move is the unglamorous one: measure cost per completed task, keep a second provider integrated, and let the trillion-dollar argument happen between the labs and their investors.

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Meta's Muse Spark Open Puts an 816-Billion-Parameter Model on Two Macs

Cartoon robot engineer linking two desktop computers beneath a glowing puzzle-piece brain in a mountain workshop

Meta released Muse Spark Open on Thursday, October 15, calling it the most capable United States open-weight model to date. That is a vendor claim, and independent testing will settle it, but the release itself is the news: after focusing on its closed Muse Wonder models earlier this week, Meta has put a frontier-scale model into downloadable weights that developers can host, inspect, and adapt outside Meta's own service.

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Eight States Sue OpenAI in Eight Courts: ChatGPT Safety Is Now a Consumer-Protection Case

Cartoon robot chatbot in a courtroom workshop facing eight small capitol domes with a gavel and an open evidence binder on a desk.

Eight state attorneys general sued OpenAI on Wednesday, October 14, each filing separately in their own state court. The states are Arizona, Arkansas, Idaho, Iowa, Kansas, Montana, Nebraska and West Virginia, according to Reuters and Bloomberg Law reporting. Announced together in Des Moines, the cases are described as the most significant coordinated state action yet against an AI company, following a first state suit by Florida in June. These are civil allegations, not court findings, and no judge has ruled.

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Anthropic's 16.8 Billion Dollar Quarter Still Was Not Fast Enough for the AI Trade

A cartoon robot accountant presents easels of stacked gold coins as a chart to animal investors in a mountain workshop.

Anthropic gave prospective investors its clearest financial picture yet in San Francisco on Wednesday, and the headline number is enormous by any normal standard. Multiple reports from the investor day, first reported by the Financial Times, put third-quarter revenue at 16.8 billion dollars, up roughly 45 percent from 11.6 billion dollars in the second quarter. The company also told attendees it was profitable on an adjusted basis for a second straight quarter and cash-flow positive in the quarter, ahead of a planned initial public offering in November.

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