OpenAI cuts funding round target by $10bn to about $20bn as AI stocks slide

The revised target

OpenAI has cut the target for its latest funding round by $10bn, now seeking about $20bn instead of $30bn, according to the Financial Times, which cited people with knowledge of the matter. The company pitched the round in September 2026 at a $1.4tn valuation, presenting it as a last chance for investors to buy in before its initial public offering next year. The valuation has since been lowered to $1.25tn, which is still well above the $852bn valuation that preceded the September pitch. OpenAI had set Friday, 30 October, as the deadline for investors to commit. The first close is expected to bring in less than $20bn, because some investors reduced the amounts they intend to subscribe.

Pitched in September 202630

Current target (about)20

Pitched in September 2026

30 $bn

Current target (about)

20 $bn

Data from the article text

Investors and structure

Investors from the United Arab Emirates, including the state-backed fund MGX, are expected to be the largest participants, according to the FT. As part of that arrangement, OpenAI would gain an option to lease newly developed computing power in the region. Founders Fund, Coatue, Sequoia Capital and Andreessen Horowitz also plan to take part, as does Masayoshi Son's SoftBank. The round is structured in stages, with the first close followed by a retail offering. A later retail offering would let wealthy individuals buy in at the same $1.25tn valuation, which could lift the round to about $20bn. OpenAI raised $122bn in March 2026 but has plans to spend multiples of that on computing power to train and run its models. OpenAI, Sequoia, Founders Fund and SoftBank declined to comment, while MGX and Andreessen Horowitz did not immediately respond to requests for comment.

Market backdrop

The revision comes after a sell-off in technology shares and growing unease over the pace and scale of AI spending. Reuters reported that the Nasdaq fell 2.9% on Friday and sat 7.8% below its record close of 6 October. The FT put the tech-heavy Nasdaq 100 down 3.5% on the same day. Alphabet's shares fell 12% on Thursday, 29 October, after the company published its results. The cut also follows a week of falls in AI stocks. One backer said the fundraising had started amid enthusiasm for the AI trade, only to be caught out by a sharp market reversal.

Previous valuation852

September pitch1,400

Current target1,250

Previous valuation

852 $bn

September pitch

1400 $bn

Current target

1250 $bn

Data from the article text

Anthropic and the timetable

Anthropic's own listing is shaping the timetable. The company made its IPO filing public on Monday, 26 October, and is expected to go public in mid-November at a valuation of $1.5tn or more. Reuters reported that OpenAI wants to close its round before Anthropic lists, since the two companies draw on similar investors. OpenAI itself plans to list in 2027. According to the Dutch daily NRC, Sam Altman said in September that a listing would not come this year and that problems with autonomous AI models had to be resolved first. The round's completion therefore hinges on investor commitments made before Anthropic's debut.