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Apple has reportedly withdrawn from discussions to join OpenAI’s upcoming funding round, which aims to raise $6.5 billion.
The decision comes just before the round closes next week. Microsoft and other tech giants remain engaged in the funding talks. This funding round is set to be OpenAI’s largest yet, potentially raising up to $6.5 billion.
OpenAI’s Funding Round Expected to Cool Off Recent Concerns
According to an exclusive report from The Wall Street Journal on September 27, the reasons for Apple’s exit remain unknown. Still, it has opened the field up for other investors like Microsoft, which has already invested $13 billion in OpenAI, and Nvidia, which is contemplating a $100 million investment in the generative AI firm.
Microsoft is expected to inject another $1 billion, building on its existing strong partnership with OpenAI, which includes the integration of AI tools into products like Microsoft’s Azure and Office suite.
JUST IN: Apple $AAPL is now reportedly no longer involved in discussions to invest in OpenAI or board discussions per WSJ
— unusual_whales (@unusual_whales) September 28, 2024
OpenAI’s ability to attract powerful investors is evident. Having already raised over $11.3 billion in seven previous funding rounds, this upcoming round could shatter previous records. As OpenAI’s funding round enters its final stretch, a diverse lineup of investors is lining up to participate.
Prominent investment firms like Tiger Global Management and MGX, a UAE-backed company, are in talks to participate. While Thrive Capital is anticipated to contribute around $1 billion, but investment amounts and participants could change before the round closes next week.
Unrest in OpenAI’s Management Direction Sparks Concern
This flurry of investment activity comes at a critical juncture for OpenAI, which is battling a series of internal challenges. Recent reports reveal that the company’s board is discussing restructuring into a for-profit business, though its non-profit division will remain separate.
This news follows a wave of high-profile departures, with Chief Technology Officer Mira Murati announcing her exit on September 25 after six and a half years, along with Research Chief Bob McGrew and VP Barrett Zoph leaving the firm.
I shared the following note with the OpenAI team today. pic.twitter.com/nsZ4khI06P
— Mira Murati (@miramurati) September 25, 2024
However, their exits raise alarms, marking a continued trend in OpenAI’s loss of top talent since its rise in popularity.
In recent months, other key figures, including co-founder Ilya Sutskever, safety leader Jan Leike, and co-founder John Schulman, have all left the company to pursue new ventures. Schulman joined rival AI firm Anthropic.
The unrest at the leadership level echoes long-standing criticisms from OpenAI co-founder and Tesla CEO Elon Musk.
Since parting ways, Musk has expressed dissatisfaction with OpenAI’s direction, accusing and suing the company and CEO Sam Altman of betraying its original mission to develop AI for humanity’s benefit, not profit.
OpenAI was created as an open source (which is why I named it “Open” AI), non-profit company to serve as a counterweight to Google, but now it has become a closed source, maximum-profit company effectively controlled by Microsoft.
Not what I intended at all.
— Elon Musk (@elonmusk) February 17, 2023
This ongoing unrest raises questions about whether these internal conflicts will impact OpenAI’s valuation or its ability to secure investments in the upcoming funding round.
