OpenAI Breaks Silence on IPO with A New AI Monetization Path in Sight

TradingKey - As one of the highest-valued unicorns in the world, OpenAI, the developer of ChatGPT, has long been under intense speculation about a potential initial public offering (IPO). Recently, OpenAI have publicly acknowledged the possibility of going public for the first time. Combined with the massive capital needs for building trillion-dollar-scale data centers and a record-breaking monthly revenue outlook, an IPO for the world’s leading AI company may be closer than ever.

On Wednesday, August 20, Sarah Friar, OpenAI’s CFO, said in an interview that the company is considering an IPO at some point in the future, though she did not disclose a timeline or additional details. 

This marks the first time an OpenAI executive has publicly addressed the possibility of an IPO, although CEO Sam Altman had previously hinted at it.

Earlier this month, sources revealed that OpenAI is conducting a private share sale worth several billion dollars — potentially $6 billion — at a valuation of $500 billion, more than doubling its value in less than a year.

It’s worth noting that recent tech IPOs have had market caps below $100 billion. Yet, based on private equity valuations, companies like SpaceX and OpenAI already have private market valuations multiple times higher. If OpenAI goes public, it would rank among the highest-valued private tech companies ever to enter the public markets.

Friar explained that the company has relied on partners like Microsoft and Oracle to support its data center buildout, and is now also receiving debt financing from banks and private equity firms. She added:

“We are trying to be thoughtful about whether there are other interesting, novel ways we could do that beyond debt.”

The massive demand for AI computing power is driving OpenAI to invest heavily in infrastructure. Last week, Altman said the company may need to spend trillions of dollars on data center construction. While OpenAI’s paying user base and revenue continue to grow, the company’s lack of profitability could limit its ability to keep raising funds through private channels.

An IPO is therefore becoming a viable option. Notably, Altman has previously said that if the company transitions to a public structure, he doesn’t believe he is the best person to lead it.

Altman emphasized that AI training demands will continue to grow, and OpenAI is investing more aggressively than any other company to stay ahead of technological progress.

Friar said that GPUs and computing power are extremely resource-intensive, and the lack of sufficient computing capacity remains the biggest challenge OpenAI faces — a key reason the company is participating in the U.S. government’s Stargate project.

Friar revealed that OpenAI reached $1 billion in monthly revenue for the first time in July. Estimates suggest OpenAI’s 2025 revenue could triple to $12.7 billion, with annualized recurring revenue hitting $10 billion.

In addition, OpenAI is exploring new growth avenues, potentially including the sale of AI infrastructure services. 

Inspired by Amazon’s model of renting out surplus cloud capacity, OpenAI may monetize its accumulated expertise in designing and building AI-optimized data centers by selling its technical know-how as intellectual property.