OpenAI to confidentially file for IPO as soon as Friday: Source

CNBC confirmed on Wednesday that OpenAI is preparing to confidentially file a draft of its IPO prospectus as soon as Friday, as the company prepares for one of the largest public markets in history.

The artificial intelligence company, valued at more than $850 billion by private investors, is working with banks including Goldman Sachs And Morgan Stanley Prepare to file in the coming days or weeks, a source familiar with the matter said on condition of anonymity because the details are confidential.

“As part of general governance, we regularly evaluate a number of strategic options,” an OpenAI representative said in a statement. “Our focus remains on execution.”

As CNBC previously reported, OpenAI is preparing for an IPO in the fourth quarter of this year. OpenAI CFO Sarah Fryer told CNBC last month that it’s “good hygiene” for a company of OpenAI’s size to “look, feel and act” like a public company, but she wouldn’t comment on any specific timeline.

Goldman Sachs and Morgan Stanley did not comment. The Wall Street Journal was the first to report the confidential filing.

OpenAI’s preparations begin as Elon Musk’s competitor SpaceX, which merged with XAI earlier this year, is set to publicly disclose its IPO prospectus on Wednesday. Sources told CNBC that Goldman Sachs will have the leading position on the left on the SpaceX prospectus, followed by Morgan Stanley and then Bank of America, Citigroup and JPMorgan Chase.

SpaceX’s offering is expected to fetch a record-breaking amount, having been valued as recently as February at $1.25 trillion. It was filed confidentially with the Securities and Exchange Commission last month.

Musk and OpenAI CEO Sam Altman are taking their bitter rivalry to Wall Street, as the former friends and co-founders spent much of the past month facing off in federal court in Oakland, California. Musk sued OpenAI, Altman, and company president Greg Brockman, alleging that they reneged on their promise to keep the company non-profitable.

On Monday, an advisory jury said Musk waited too long to sue, a decision quickly adopted by Judge Yvonne Gonzalez Rogers. Musk called the decision a “calendar technicality” in a post on his social network X.

OpenAI kicked off the AI ​​boom with the launch of its ChatGPT chatbot in 2022, and has since become one of the most valuable private companies in the world.

The company has raised more than $180 billion from investors, and it’s burning through cash at a historic pace. As Altman moves toward an IPO, it is under pressure from investors to show that the numbers work, while facing increasingly stiff competition from rivals, particularly Anthropic, which is winning in the enterprise and AI coding market.

Anthropic is currently in talks with investors to raise funds at a valuation of $900 billion, which would put it ahead of OpenAI. The company said in April that it topped $30 billion in annual revenue.

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