OpenAI is preparing to confidentially file a draft of its IPO prospectus as soon as Friday, as the company gears up for what could be one of the largest public markets debuts in history, CNBC confirmed on Wednesday.
The artificial intelligence company, which is valued at more than $850 billion by private investors, is working with banks including Goldman Sachs and Morgan Stanley to prepare to file in the coming days or weeks, according to a source familiar with the matter who asked not to be named because the details are confidential.
“As part of normal governance, we regularly evaluate a range of strategic options,” An OpenAI representative said in a statement. “Our focus remains on execution.”
OpenAI has been preparing to IPO as soon as the fourth quarter of this year, as CNBC previously reported. OpenAI CFO Sarah Friar told CNBC last month that it is “good hygiene” for a company of OpenAI’s size to “look and feel and act” like a public company, but she wouldn’t comment on a specific timeline.
Goldman Sachs and Morgan Stanley did not comment. The Wall Street Journal was first to report the confidential filing.
OpenAI’s preparations land as Elon Musk’s competitor SpaceX, which merged with xAI earlier this year, is set to publicly disclose its IPO prospectus as soon as Wednesday. Goldman Sachs will have the lead left position on the SpaceX prospectus, followed by Morgan Stanley, and then Bank of America, Citigroup and JPMorgan Chase, sources told CNBC.
SpaceX’s offering is expected to bring in a record-breaking sum after it was most recently valued at $1.25 trillion in February. It confidentially filed with the Securities and Exchange Commission last month.
Musk and OpenAI CEO Sam Altman are taking their bitter rivalry to Wall Street after the former friends and co-founders spent much of the last month facing off in federal court in Oakland, California. Musk sued OpenAI, Altman and Greg Brockman, the company’s president, alleging they went back on their vow to keep the company a nonprofit.
On Monday, an advisory jury said that Musk waited too long to sue, a verdict that was immediately adopted by Judge Yvonne Gonzalez Rogers. Musk called the decision a “calendar technicality” in a post on his social network X.
OpenAI kickstarted the AI boom with the launch of its ChatGPT chatbot in 2022, and it’s ballooned into one of the most valuable private companies in the world since then.
The company has raised more than $180 billion from investors, and it continues to burn through cash at a historic pace. As Altman pushes toward an IPO, he’s under pressure from investors to show that the numbers work, while facing increasingly stiff competition from rivals, most notably Anthropic, which is winning in the enterprise and the AI coding market.
Anthropic is currently in talks with investors to raise money at a $900 billion valuation, which would push it ahead of OpenAI. The company said in April that it’s topped $30 billion in annualized revenue.
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