Amazon is discussing a $50 billion investment in OpenAI, possibly becoming its biggest backer

OpenAI is trying to raise up to $100 billion in new funding. Amazon wants in, and is discussing a $50 billion stake in the company, which would make it the biggest investor in the round.

If the deal lands, it would be one of the largest private tech investments ever seen.

Andy Jassy, Amazon’s CEO, is leading the talks directly with Sam Altman, who runs OpenAI. People close to the talks say the structure of the deal could still shift.

But this would give OpenAI a massive cash boost while pushing its valuation as high as $830 billion, as earlier reported by The Wall Street Journal.

Amazon cuts jobs while spending billions on OpenAI and Anthropic

Even while Amazon is laying off workers, it’s still writing huge checks in artificial intelligence. The company just cut 16,000 corporate jobs this week and slashed 14,000 roles back in October. At the same time, it’s investing billions in AI infrastructure, AI chips, and now potentially OpenAI.

Amazon already has a big footprint in OpenAI’s rival, Anthropic, which was founded in 2021 by former OpenAI researchers, including CEO Dario Amodei. Amazon has invested $8 billion in Anthropic and gave them an $11 billion data center in Indiana. It also serves as one of Anthropic’s key cloud providers.

This means Amazon is throwing money at both sides of the AI race. Even while pushing funds into OpenAI, it’s staying close to Anthropic and its Claude model. This double-play could give Amazon control over a bigger chunk of the AI ecosystem than anyone else.

Back in November, OpenAI signed a deal with Amazon Web Services to buy $38 billion worth of compute over several years. This was a shift from its usual dependency on Microsoft’s infrastructure. The new funding talks might also include a clause where OpenAI uses Amazon’s custom AI chips.

SoftBank is also looking to invest as much as $30 billion in OpenAI, adding to its existing stake. Other investors already involved with the company include Thrive Capital, Khosla Ventures, and MGX, a fund from the UAE.

Now, OpenAI is also reaching out to sovereign wealth funds in the Middle East and more venture firms to help close the full $100 billion round.

At the same time, OpenAI is exploring the option of going public. There’s no IPO timeline yet, but it’s one of the options on the table. The company has also started testing ads as a way to bring in more revenue, especially with all the rising costs tied to building and running powerful AI models.

Founded in 2015, OpenAI has become one of the most expensive AI companies to run. It’s spent tens of billions to train its systems and keep top researchers. ChatGPT made it a household name, but the costs behind it are massive. This round of funding, if it gets filled, will take OpenAI into a whole new league.

The smartest crypto minds already read our newsletter. Want in? Join them.