OpenAI Reportedly Completes $7B Employee Tender Offer, Raising IPO Timing Questions

OpenAI has completed a $7 billion tender offer, buying shares from employees at a valuation of $852 billion, according to Bloomberg. The buyback gives staff a chance to cash out equity compensation while the company stays private, but it may also push back expectations for an IPO this year.

The price matches the valuation OpenAI received in its March fundraising round, which added $122 billion to the company's war chest. OpenAI also filed confidentially with the Securities and Exchange Commission in June, an early step toward a potential public listing. However, the tender offer suggests that a debut may not be imminent. With many tech companies staying private longer than earlier generations of startups, private tenders have become a common way for firms to let employees realize stock-based compensation without the scrutiny of public markets.

OpenAI did not respond to a request for comment by publication time.

The timing is important. CEO Sam Altman wrote last month that "we did not have our best 12 months ever, which is mostly my fault, but we are about to have our best 12 months to date." Companies preparing to go public typically want strong financial results to show investors, and the Wall Street Journal reported in April that OpenAI had missed internal financial goals.

OpenAI's growth and products would likely draw intense interest from public market investors. But rival Anthropic, reportedly profitable earlier this year, gives OpenAI another reason to make sure its financial story is compelling before an IPO. The tender offer could therefore be a signal that OpenAI wants to give its new strategy more time to work, particularly as it narrows its focus on enterprise business.