Having recently received a large funding round that valued OpenAI at 157 billion, the creator of ChatGPT has received additional financial support with credit support from a number of financial institutions, many of which are its customers. The company led by Sam Altman announced yesterday (Oct. 3) that it has established a $4 billion credit line from JPMorgan Chase (JPM), Citi, Goldman Sachs (GS), Morgan Stanley (MS), Santander, Wells Fargo (WFC), SMBC, UBS and HSBC.
“We are proud to have the strongest banks and investors in the world backing us,” said Sarah Friar, chief financial officer of OpenAI, in a statement. “This credit facility further strengthens our balance sheet and provides flexibility to capture future growth opportunities.”
The credit line arrangement includes the ability to increase it by $2 billion, according to CNBC. Combined with OpenAI’s recent $6.6 billion funding, OpenAI now has access to more than $10 billion in funding and “the flexibility to invest in new programs and operate with full agility as we scale,” OpenAI said in a press release.
OpenAI is now flush with cash, but it’s also burning money at an alarming rate. Despite rising revenue (annual revenue is expected to triple from $3.7 billion this year to $11.6 billion next year), the company is on track to lose $5 billion this year. The most significant expense comes from its use of Microsoft’s (MSFT) cloud computing platform to run its products.
Banks embrace productive AI
OpenAI’s arrangement with nine major financial institutions also means a growing relationship between banks and productive AI. Goldman Sachs, for example, which banned the use of ChatGPT last year, has since begun testing AI tools that can help developers and help summarize and document.
Some of the banks involved in OpenAI’s line of credit are ChatGPT-maker’s own customers. The credit institution is “reaffirming our relationship with an exclusive group of financial institutions, many of which are OpenAI customers,” the AI ​​company said. Santander previously revealed it was testing the use of ChatGPT, while Morgan Stanley in June launched a new AI assistant powered by OpenAI’s GPT-4 model to help its nearly 16,000 financial advisors take notes in client meetings and draft emails. JPMorgan Chase, too, has used OpenAI products, launching an AI assistant in August with the help of an OpenAI model in an effort to improve the productivity of more than 60,000 employees.
