OpenAI’s $20B target gets a $10B haircut as AI stocks sour the pitch

OpenAI reduced its fundraising target by $10 billion to $20 billion as a technology-stock selloff and weaker investor demand complicated its financing plans ahead of a potential 2027 IPO. The company initially sought $30 billion during September discussions with institutional investors.

According to an Oct. 31 report, OpenAI also lowered its proposed valuation from $1.4 trillion to $1.25 trillion, a $150 billion reduction. Investors were given an October 30 deadline to submit initial funding commitments, and the Wall Street Journal reported that the initial round raised approximately $11 billion. OpenAI is now seeking additional investments to reach its revised $20 billion goal.

A consortium of United Arab Emirates investors, including MGX, could lead the funding round and become its largest participant. Under the reported agreement, OpenAI would lease newly developed computing capabilities in the UAE. Other potential investors include Founders Fund, Coatue and Sequoia Capital.

OpenAI had promoted the funding round as an investment opportunity while preparing for a possible 2027 public listing. The revised target comes after some investors reduced their commitments following declines in technology stocks.