OpenAI finalizes $40 billion funding at $300 billion value | Fortune
OpenAI, the AI giant behind ChatGPT, started 2025 at the top of the tech world. It had just secured a jaw-dropping $40 billion in funding, giving it a massive $300 billion valuation — the highest of any startup. ChatGPT was drawing in a stunning 500 million users a week. CEO Sam Altman had every reason to celebrate, especially with the birth of his first child.
But then, things started to unravel.
Big Tech Rivals Are Closing In
OpenAI is now under pressure from nearly every direction — Meta, Google, Amazon, and even its own investor, Microsoft. New AI players like Elon Musk’s xAI have also released competing chatbots, creating a crowded and competitive space.
Some OpenAI engineers are working extreme hours, reportedly over 80 hours a week. The burnout became so intense that the company gave its entire staff a week off earlier this month.
Meta Is Poaching OpenAI Talent
Sam Altman claims Meta has been luring away top AI talent with eye-popping signing bonuses — some allegedly as high as $100 million. While one former OpenAI researcher denied getting such an offer, Meta has already snagged at least three key team members.
Altman brushed off the losses, saying OpenAI still has a passionate, dedicated team. But the competition for top AI talent is fierce — and it goes both ways. OpenAI has recently recruited engineers from Tesla and xAI too.
Deal With Windsurf Falls Apart
A $3 billion acquisition deal between OpenAI and AI coding startup Windsurf collapsed this summer. Microsoft, OpenAI’s biggest investor, reportedly viewed Windsurf as a threat to its own tool, Copilot, and didn’t want the deal to go through.
Instead, Windsurf CEO Varun Mohan and some of his team are now heading to Google DeepMind — a big win for Google in the AI talent war.
Microsoft and OpenAI Aren’t Seeing Eye to Eye
The partnership between OpenAI and Microsoft is becoming rocky. At the center of the tension? Money, control, and differing views on artificial general intelligence (AGI).
According to their agreement, OpenAI hitting $100 billion in profits (their benchmark for AGI) would cut Microsoft out of future revenue. Microsoft, understandably, wants to renegotiate. CEO Satya Nadella has even called the $100B AGI target “nonsensical benchmark hacking.”
OpenAI’s Next Big Model Gets Delayed
Altman recently announced a delay to OpenAI’s newest language model — the company’s first open-weight system since GPT-2 in 2019. The reason? More safety testing is needed before release.
This was the second delay in a month, pushing the launch indefinitely. Meanwhile, xAI’s Grok chatbot has already rolled out a new update with enhanced voice and visual capabilities.
Legal Trouble Over “io” Branding
OpenAI’s partnership with famed Apple designer Jony Ive hit a legal snag. Their planned consumer AI product was named “io,” but a Google spinoff called “iyO” filed a lawsuit claiming the names were too similar.
A judge agreed the case had merit and ordered OpenAI to stop using the “io” name — for now. Still, OpenAI completed the acquisition and says Ive will continue designing future AI products for the company.
Amazon Is Making a Movie About Altman — and It’s Not All Praise
Amazon Studios is developing a movie titled Artificial about Sam Altman and OpenAI. But early reports suggest it may not cast him in the best light.
The film reportedly focuses on Altman’s 2023 firing and return as CEO, painting him as a “master schemer.” It’s already drawing comparisons to The Social Network, the film about Facebook’s rise that left a lasting impact on Mark Zuckerberg’s image.
Despite all the drama, OpenAI remains the most valuable startup in the world, and ChatGPT continues to dominate. But as competition grows and internal challenges mount, it’s clear that staying on top in the AI world is anything but easy.
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