Sources: Eric Schmidt, who owns ~1% of Anthropic after investing tens of millions in its Series A, is poised to have one of the largest windfalls from its IPO (Bloomberg)

OpenAI is moving swiftly to raise capital before rival Anthropic embarks on its anticipated IPO in mid-November, aiming to potentially value the ChatGPT developer over US$1.4 trillion, according to sources. This rapid fundraising reflects OpenAI's desire to outpace Anthropic, as both companies are targeting similar investors. SoftBank Group, Abu Dhabi-based MGX, and other existing OpenAI backers are in talks to join the about US$30 billion round.

The acceleration highlights the intense competition for capital between the two AI developers, each pursuing a trillion-dollar valuation amid rising interest rates, tech stock volatility, and heightened scrutiny of AI valuations. OpenAI has been engaging with long-only funds and sovereign wealth funds recently, while Anthropic hosted its own investor day.

The funding round is expected to proceed faster than typical for an offering of its size. OpenAI needs the funds to support its infrastructure investments and maintain a robust balance sheet if IPO market delays further impact its 2027 listing plans. Investors face the challenge of evaluating and allocating capital to two complex, competing offerings within a short timeframe.

OpenAI is positioning itself by highlighting accelerated growth after launching the GPT-6 Astra model, with annualized revenue reaching US$50 billion, and projecting a rise to US$70 billion by year-end. The company has also reduced prices on cheaper models, boosting usage, and stated its ability to lower AI model costs further. Anthropic's annualized revenue hit around US$65 billion by July, with a notable quarter-over-quarter increase to US$16.8 billion.

However, slowing revenue growth has raised investor concerns about its valuation. OpenAI is aiming to finalize the fundraising before Anthropic's financial disclosures, potentially avoiding comparisons and the need for CFO Sarah Friar to provide more details on revenue growth and financial outlook. OpenAI's valuation was last at US$852 billion in March after a record US$122 billion funding round, including a US$50 billion commitment from Amazon.

Some AI startups are delaying their IPOs to avoid competing with Anthropic's anticipated debut, while others are adjusting private fundraising strategies to sidestep the IPO timeline. Market volatility, rising bond yields, and concerns about AI safety have led to investor caution, impacting AI-related IPOs.