Elon Musk has led a group of investors in a proposal to purchase the nonprofit arm of OpenAI for $97.4 billion, The Wall Street Journal reports. The deal has already been described as a “dramatic escalation in Silicon Valley’s most bitter AI rivalry.” The proposal was presented to OpenAI’s board on Monday morning.
The offer comes from a coalition of Musk-backed investors, including his own AI company xAI and major venture capitalists such as Valor Equity Partners, Hollywood mogul Ari Emanuel, and 8VC, the firm founded by Palantir co-founder Joe Lonsdale.
OpenAI’s Future and Musk’s Opposition
This proposal comes at a crucial moment for OpenAI, as CEO Sam Altman has been working to transition the company into a for-profit entity. OpenAI recently announced plans to raise $40 billion at a $340 billion valuation. Additionally, in late January, the $500 billion AI megaproject Stargate was revealed, with OpenAI playing a key role.
For Musk, this bid marks his most significant move yet in opposing OpenAI’s shift toward commercialization. He believes the company has strayed from its original mission of safe and open AI development and is currently suing OpenAI over this matter. Musk co-founded OpenAI with Sam Altman in 2015 but left the organization in 2019.
“It’s time for OpenAI to return to the open-source, safety-focused force for good it once was,” Musk said in a statement provided to The Wall Street Journal by his lawyer, Marc Toberoff. “We will make sure that happens.”
The Rivalry Intensifies
Musk’s offer further complicates OpenAI’s plans to become a commercial entity, as his team has vowed to match or exceed any competing bids. This creates a difficult situation for Altman, who is already engaged in negotiations, adds NIXSOLUTIONS.
Shortly after reports of the deal emerged, Sam Altman posted on X: “No thanks, but we’ll buy Twitter for $9.74 billion if you want.” When asked for comment, OpenAI pointed to Altman’s post. Musk’s representatives have yet to respond to the offer.
The outcome of this bid remains uncertain, yet we’ll keep you updated as more details unfold.