Three years ago, Sam Altman illuminated the fuse of what became the most explosive bull run in tech startup history with the launch of ChatGpt.
In addition to Openai’s rapid rise to a $500 billion valuation, other well-known names like SpaceX, Anthropic and Anduril have seen recent astronomical markup. According to Forge Global, seven of the most valuable private tech companies in total are worth $1.3 trillion on paper, nearly doubled over the past year.
Forge’s valuation is based on trading activities and round round valuations and bid offers.
The number continues to increase. On Friday, CNBC’s David Faber reported that Elon Musk’s Xai is raising $10 billion at a $200 billion valuation just months after he achieved the $150 billion valuation.
Like the open market where the artificial intelligence boom dramatically raised its market capitalization nvidia, Broadcom, Oracle AI is also the dominant driver of private market valuation.
Openai is leading the pack (Forge is valued at $324 billion), followed by the four-year-old human race at $178 billion, while Xai is $90 billion, according to Forge. All three of these companies compete directly with each other. Google and Metacreate large-scale language models of the future.
Databricks is also one of Forge’s seven leading companies, valued at $100 billion due to the heavily invested by data analytics startups in AI.
Other companies in the group are Musk’s SpaceX, Fintech Company Stripe and Defense Tech Company Anduril, with Forge valued at $456 billion, $92 billion and $53 billion, respectively. Because AI has a major impact on defense and national security, Forge has established a new defense fund to ensure institutions are exposed to the sector.
Sam Altman, CEO of Openai (L) and CEO of Tesla, Elon Musk.
Reuters
As a group, they have quadrupled their value since late 2022 when ChatGpt first appeared on the market.
Forge CEO Kelly Rodriques said the surge in ratings reflects not only forecasts but actual growth.
“We’ve never seen this in a market like never before,” he said. “A company is already growing at 100%, 200% and 300% with a fairly large number.”
Hunger for AI exposure is reshaping capital flows into AI, beyond just the few companies at the top. According to Forge, 19 AI companies have raised $65 billion so far this year, accounting for 77% of private market capital.
With that kind of cash available, these companies have little incentive to make it public, Rodriguez said.
“If these inventory is fluid and you have access to as much capital as you can get, the regulations are probably the only thing that will stop them from staying private as long as they want,” he said.
Even if they are not public, they have a major impact on the open market.
Oracle’s shares rose 36% on the first day of this month, mainly after a software maker’s revenue report due to a large contract with Openai. Broadcom also forged a new mammoth deal with the creator of ChatGpt. Microsoft It continues to benefit from substantial capital gains to the company.
Microsoft, Amazon, Google and Meta all recently raised capital expenditure guidance to reflect infrastructure demand.
Openai’s Altman looks at some reasons for caution.
At a dinner with a reporter in San Francisco last month, he described his current reputation as “unusual” and admitted that “we are in the bubble.”
But he’s still a big bet.
“We should expect Openai to spend trillions of dollars on building a data center,” he said. “We may be spending more aggressively than any company that has ever spent on.
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