It is said that OpenAI is having a lot of financial challenges and could lose up to $5 billion in 2024, said a study by The Information. The story used previously unknown financial information and interviews with insiders to say that OpenAI plans to spend around $7 billion on training AI and another $1.5 billion on hiring people.
These costs are much higher than those of rivals, like Anthropic, which is backed by Amazon and expects to burn $2.7 billion in 2024.
All of these significant expenses mean that OpenAI might need to get additional funding within the next year to get its finances back on track. The company has raised more than $11 billion in seven funding rounds so far. ARK Investment Management participated in the most recent round in April for an unknown amount.
OpenAI Faces Regulatory Scrutiny
Since ChatGPT came out in November 2022, OpenAI has quickly become popular, with more than 100 million users every week. A company in the United States released a new generative AI model on July 18. It is called “GPT-4o Mini.”
It is also said that OpenAI is working on a more advanced AI model called “Strawberry.” This model aims to be more intelligent than its current flagship model, GPT-4o, and give answers that are more like those of humans.
Regulatory bodies are keeping a close eye on the company. For example, the US Securities and Exchange Commission may look into claims of violations linked to non-disclosure agreements. Also, on July 23, lawmakers in the United States sent a letter to OpenAI CEO Sam Altman expressing concerns about the company’s safety standards and hiring methods.
The letter, which was first seen by the Washington Post, questions OpenAI’s openness and asks the company if it will promise to let U.S. government agencies test and review its next foundation model before it is put into use.
