Softbank Completes $40 Billion Investment in OpenAI: Sources

• SoftBank had previously syndicated $10 billion and invested $8 billion, with the final $22-22.5 billion completing the commitment
• The investment values OpenAI at a $260 billion pre-money valuation, with funds to be deployed over 12-24 months
• Some funding will support OpenAI's AI infrastructure joint venture with Oracle and SoftBank

SoftBank has completed its $40 billion investment commitment to OpenAI, with the final $22-22.5 billion tranche delivered last week, sources told CNBC's David Faber. This follows earlier contributions where SoftBank had syndicated $10 billion and directly invested $8 billion in the ChatGPT maker.

The investment values OpenAI at a $260 billion pre-money valuation, marking one of the largest private funding rounds in tech history. The funding timeline, initially expected to span 12-24 months, appears to have been accelerated with the completion of the full commitment.

A portion of the investment is allocated to OpenAI's artificial intelligence infrastructure joint venture with Oracle and SoftBank, highlighting the significant capital requirements for AI development and deployment at scale.

Market Implications:

• Reinforces SoftBank's aggressive positioning in the AI sector following its Vision Fund investments
• Validates the massive valuations in the generative AI space, with OpenAI leading the market
• Signals continued institutional confidence in AI despite concerns about profitability and competition
• May pressure other tech giants to increase AI investments to maintain competitive positioning

Key Takeaways:

The deal underscores the capital-intensive nature of AI development and SoftBank's willingness to deploy massive amounts of capital in pursuit of AI leadership. For investors, this transaction sets a new benchmark for AI company valuations and demonstrates the sector's ability to attract unprecedented funding levels despite the broader tech market volatility.