OpenAI Cuts Funding Target to $20 Billion at $1.25 Trillion Valuation, FT Reports

OpenAI has cut the target for its latest funding round by $10 billion and now seeks to raise $20 billion at a $1.25 trillion valuation, the Financial Times reported on Friday, citing people with knowledge of the matter, according to Reuters.

Earlier this month Reuters reported that OpenAI planned to raise $30 billion at a $1.4 trillion valuation and was racing to secure commitments before rival Anthropic's expected public market debut in mid November. The two labs are tapping a similar investor base, Reuters has reported.

OpenAI set a Friday deadline for investors to commit, the FT said. The first close is expected to raise less than $20 billion after some investors reduced their allocations, according to the FT report. OpenAI did not immediately respond to a request for comment from Reuters.

The cut follows a selloff in AI related stocks. The Nasdaq dropped 2.9% on Friday and is down 7.8% from its record close on October 6, Reuters reports. CoinDesk notes that OpenAI had previously put off IPO plans until 2027.

The Wall Street Journal has since reported that OpenAI has secured about $11 billion so far, The Decoder writes. The company is reportedly planning an IPO early next year.