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Microsoft to invest $10 billion in OpenAI, creator of content tool ChatGPT


There has been unending buzz about ChatGPT, a content creation tool built by artificial intelligence startup OpenAI. The discussions have centred on ChatGPT’s ability to churn out web content that’s close to what humans would write.

In spite of the back-and-forth discussions, it’s clear that ChatGPT is an outstanding innovation that improves on milestones made by other trailblazers.

Perhaps this is the same realization that has led tech giant Microsoft to express interest in investing in the new OpenAI. According to online publication Semafor, Microsoft plans to invest  $10 billion into the owner of ChatGPT.  This funding would raise OpenAI’s valuation to $29 billion, sources familiar with these developments have revealed.

It isn’t clear whether the deal has been finalized but term sheets sent to prospective investors indicated the plan was to close the deal by the end of 2022.

If the deal is successful, Microsoft will reportedly get a 75% share of OpenAI’s profits until it recoups its investment. Thereafter Microsoft will assume a 49% stake in OpenAI.

ChatGPT has caused a storm in the tech world following its natural language processing model designed to generate text that’s very close to human writing.

Investing in ChatGPT, observers say, could give Microsoft an edge in its never-ending competition with search giant Google.

OpenAI was founded by Silicon Valley entrepreneur Sam Altman in 2015 but has gained prominence since the launch of ChatGPT to the public in November last year. Five days after its launch, Altman said ChatGPT had crossed 1 million users.

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Simon W Nderitu

Simon is a tech enthusiast who keeps a close eye on emerging technologies, startups and the general business environment. You will often catch him totally immersed and drooling over Artificial Intelligence, Machine Learning, Virtual Reality, Augmented Reality, IoT and just about any other tech that promises to revolutionize the way we live. Send tips to snderitu@techtrendske.co.ke

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