OpenAI has confidentially filed for an initial public offering with the SEC, marking a major step toward becoming a publicly traded company. The move comes just a week after rival Anthropic filed its own IPO paperwork and days before Elon Musk’s SpaceX begins its roadshow. OpenAI, now valued at over $850 billion, is targeting a public debut as soon as the fourth quarter of this year.
The Confidential Filing Strategy
A confidential S-1 filing allows OpenAI to submit its financials to regulators for review before making them public. CFO Sarah Friar previously told CNBC that it’s “good hygiene” for a company of OpenAI’s size to operate like a public entity, though she declined to give a specific timeline. In a rare move, OpenAI preemptively announced the filing, acknowledging it expected the news to leak anyway. The company stressed it hasn’t decided on timing, noting that staying private longer might be easier for certain projects.
Tender Offer and Wall Street Prep
OpenAI is also planning a tender offer that lets employees sell shares at the latest valuation of $852 billion post-money. This move helps ease near-term liquidity pressure while the company works with banks like Goldman Sachs and Morgan Stanley on the IPO. Since launching ChatGPT in 2022, OpenAI has grown to over 900 million weekly active users, but it faces stiff competition from Anthropic, Google, and Musk’s xAI (now merged with SpaceX).
The Third Phase of OpenAI
CEO Sam Altman described the IPO as part of “the third phase of OpenAI” in a blog post. The first phase was research toward AGI, the second was becoming a product company. Now, Altman says the economy is reshaping around AI, and the focus is on making advanced AI abundant, affordable, and safe. To streamline operations, OpenAI has shuttered fringe projects like Sora and doubled down on its enterprise business and coding assistant Codex. The company has raised over $180 billion but still burns cash as it builds out infrastructure.
Source: CNBC
