Over the last six months, the exponential growth of artificial intelligence (AI) has sparked phenomenal interest among investors, tech enthusiasts, and the general public.
Leading the vanguard of this AI revolution is OpenAI, the creators of the game-changing AI-powered language model ChatGPT.
Standing for Chat Generative Pre-Trained Transformer, ChatGPT gained a million users within 5 days of launch, and 100 million users within 6 months, making it the fastest-growing tech application in history.
ChatGPT’s ability to write clear answers with sentences that seem to be written by a real human has made it a radical new offering in the world of consumer-use generative AI.
But can the average investor buy OpenAI stock and claim a stake in the success of ChatGPT?
- What is Open AI?
- Investing in OpenAI and ChatGPT Stock
- How to invest in OpenAI Stock indirectly
- Who has invested in ChatGPT Stock?
- What’s the Best Way to Gain Stock Exposure to ChatGPT?
- What’s the Chat GPT Stock Name?
- Why Invest in AI-Powered Company Stocks?
- Chat GPT Stock FAQs
What is Open AI?
OpenAI was founded in December 2015 with a mission to ensure that artificial general intelligence (AGI) benefits all of humanity. It was the brainchild of tech luminaries such as Ilya Sutskever, Greg Brockman, and Andrej Karpathy.
As reported in Wired magazine, co-founder Sam Brockman, wrote a shortlist of the best minds in the field of AI research and then proceeded to hire 9 of them as the first employees. Open AI wanted the best possible talent and had a clear vision to disrupt the industry forever.
Since then, OpenAI has been involved in a plethora of cutting-edge AI projects. They’ve made significant contributions to the fields of machine learning, reinforcement learning, and natural language processing. The organization’s commitment to open-source sharing has led to countless AI advancements.
Notable achievements include the development of advanced models like GPT-3, DALL-E (capable of creating images from text descriptions), and CLIP (an AI that understands images and text together). These developments mark a significant step forward in AI research and application.
For many of us, ChatGPT became the most significant invention since the discovery of the internet, and it was immediately clear that it would change our way of working for all time.
Investing in OpenAI and ChatGPT Stock
At the time of this writing, OpenAI remains a private entity, which means that its shares are not available for purchase on any public stock exchange.
OpenAI operates under a ‘capped-profit’ model under the umbrella of the parent entity, the OpenAI non-profit. While it can attract investment, this structure is designed primarily to ensure that OpenAI’s mission to benefit humanity is not compromised by the pursuit of profit. Therefore, traditional stock-based investments, as typically seen with publicly traded companies, are not available.
Investment opportunities are primarily available to institutional investors, venture capitalists, and, occasionally, select individuals through private funding rounds.
Is ChatGPT a publicly traded company?
The organization has not announced any plans to go public, and potential investors should note that direct investment in OpenAI may not be possible without an invitation from the company.
How to invest in OpenAI Stock indirectly
While direct investment in OpenAI may not be accessible to the average investor, it is possible to gain exposure to OpenAI’s work indirectly by investing in companies that are partners or collaborators with OpenAI.
For example, Microsoft invested $1 billion in OpenAI in 2019 and is a major partner in various projects. By investing in Microsoft, investors can indirectly gain exposure to the success of OpenAI.
Invest in AI-focused Exchange Traded Funds (ETFs)
As previously mentioned, ETFs offer an accessible route to gain exposure to the AI sector. Some ETFs have a broad tech focus but include many companies that are heavily invested in AI. Other ETFs are specifically focused on AI and machine learning. While none of these will provide direct exposure to OpenAI, they can still be a valuable part of an AI-focused investment strategy.
Here are some of the most popular AI-focused ETFs:
- iShares Exponential Technologies ETF (IETC)
- Defiance Next Gen Digital Transformation ETF (FFTY)
- ROBO Global Robotics and Automation Index ETF (ROBO)
- ARK Innovation ETF (ARKK)
- ARK Autonomous Technology & Robotics ETF (ARKQ)
Invest in AI Start-ups
Venture capital and angel investing in AI start-ups is another potential method to invest in the AI field. While this comes with a high level of risk, as start-ups often fail, it can also provide substantial rewards if the start-up is successful. Furthermore, some start-ups may be using technology based on the open-source software and research provided by OpenAI, providing another indirect link.
Invest in Public Companies with Heavy Involvement in AI
Companies like Alphabet (Google’s parent company), Amazon, IBM, and NVIDIA are heavily involved in AI research and development.
These companies compete in some areas with OpenAI, but they also benefit from AI’s overall growth and success as a field. Investing in these companies can be another way to indirectly profit from the growth of AI, including the work being done by OpenAI.
- Microsoft (MSFT)
- Alphabet (GOOGL)
- Nvidia (NVDA)
- Intel (INTC)
- IBM (IBM)
- Amazon (AMZN)
- Salesforce (CRM)
- Cognizant (CTSH)
- Palantir (PLTR)
Who has invested in ChatGPT Stock?
Here’s a glimpse into some of the key supporters of OpenAI’s journey:
Individual Investors into Open AI
1. Reid Hoffman, LinkedIn co-founder
2. Peter Thiel, PayPal co-founder
3. Jessica Livingston, a founding partner of Y Combinator
4. Elon Musk
Corporate Investors into Open AI
2. Khosla Ventures
The exact funding earmarked for ChatGPT is not publicly disclosed. However, given the scope and capabilities of the technology, it is estimated to involve substantial resources running into hundreds of millions of dollars. This funding continues to power the growth and development of ChatGPT and OpenAI’s broader mission.
OpenAI’s Funding Model
OpenAI operates on a unique funding model incorporating a cap on economic returns for investors and employees. The main thrust behind this approach is to ensure that a majority of the value derived from the success of artificial general intelligence benefits all of humanity.
The economic return cap is negotiated individually with each limited partner, considering the risks of investing in OpenAI. The first round of investors faces a cap set at 100x their investment, but it is anticipated that this multiple will be reduced for future rounds.
The decision to cap economic returns underlines OpenAI’s commitment to equitable distribution of the benefits of artificial general intelligence. It sets a precedent for ensuring the development and application of AI technology happens in a safe, beneficial, and fair manner for everyone.
What’s the Best Way to Gain Stock Exposure to ChatGPT?
Here are three companies that have allied their fortunes, to greater or lesser degrees with ChatGPT. Investing in them would give you an indirect exposure to a rise in OpenAI’s value.
Microsoft’s alliance with OpenAI, initiated in 2019, embodies a shared aspiration to responsibly progress and democratize advanced AI research.
This partnership was significantly bolstered by Microsoft’s substantial investments in OpenAI, including an initial $1 billion in 2019, followed by another round in 2021, and a major $10 billion investment recently.
Microsoft’s considerable investments in AI via OpenAI reflect a strategic approach to compete with tech giants like Alphabet Inc., Amazon.com Inc., and Meta Platforms Inc.
Simultaneously, OpenAI leverages Microsoft’s substantial funding and the cloud-computing prowess of Azure for processing immense volumes of data and running increasingly complex AI models. Such technological support enables programs like DALL-E to create realistic images from a few words and ChatGPT to generate astonishingly human-like conversational text.
In addition to gaining a competitive edge in the AI landscape, Microsoft aims to enhance Bing’s market share in the search engine market with the help of ChatGPT. Satya Nadella, Microsoft’s CEO, has noted a new competition in this space, viewing every market share gain as a significant win for Bing. AI integration is seen as an opportunity to shift the dynamics in a market dominated by Google.
Nvidia’s technology plays a pivotal role in OpenAI’s growth, particularly in the training and deployment of large language models (LLMs) like ChatGPT. LLMs are a branch of artificial intelligence (AI) capable of generating human-like text, translating languages, crafting various types of creative content, and providing informative responses to queries.
At the heart of this process lie Nvidia’s Graphic Processing Units (GPUs), which supply the necessary processing power for training these large AI models. But it’s not just about raw power—Nvidia’s CUDA software platform streamlines the development and deployment of AI applications. CUDA is a parallel computing platform that allows developers to harness the robust capabilities of GPUs effectively, enhancing computational efficiency.
Beyond software, Nvidia’s Cloud services—under the banner of NVIDIA Cloud—offer a scalable, reliable infrastructure for executing AI applications. NVIDIA Cloud delivers a range of services necessary to train, deploy, and manage AI applications, encompassing GPU resources, storage, and networking.
Nvidia has been more than just a technology provider for OpenAI; it’s been a strategic partner. Nvidia was an early investor in OpenAI, contributing not only capital but also their expertise in GPU research and development to foster new AI technologies. This strategic partnership has facilitated significant advancements in AI under OpenAI’s banner.
For instance, in 2018, OpenAI utilized Nvidia GPUs to train Dactyl, a robotic hand that learns to manipulate objects in simulated environments. In 2021, GPT-3, a large language model capable of generating human-like text, was trained using Nvidia GPUs.
What’s the Chat GPT Stock Name?
There is no Chat GPT stock name because ChatGPT is not a publicly traded company. So OpenAI does not have a traditional stock offering, so there is no way to invest directly in ChatGPT.
Why Invest in AI-Powered Company Stocks?
Chat GPT aside, AI is a very hot topic in investing right now.
Artificial Intelligence (AI) is having a transformative role in a wide range of industries and sectors.
Here are a few reasons why investing in AI can be a promising choice:
Technological Advancements: AI continues to evolve rapidly, and its applications are becoming increasingly sophisticated. This ongoing advancement offers investors the opportunity to capitalize on groundbreaking technologies with the potential for high returns.
Widespread Applications: AI has applications in almost every industry, from healthcare and finance to retail, transportation, and entertainment. The breadth of its usage offers diverse investment opportunities across numerous sectors.
Efficiency and Productivity: AI technologies are capable of improving efficiency and productivity in various sectors by automating tasks, enhancing decision-making processes, and streamlining operations. These benefits make AI-based solutions increasingly attractive to businesses, which in turn can lead to significant market growth and investment returns.
Market Growth: The AI market is expected to grow exponentially in the coming years. According to a report by Grand View Research, the global AI market size is expected to reach $733.7 billion by 2027, growing at a compound annual growth rate (CAGR) of 42.2%.
Data Analysis: AI excels at analyzing large datasets and can derive meaningful insights from them. As the world becomes increasingly data-driven, this capability is becoming more valuable. Companies that can effectively harness the power of data through AI have the potential to outperform their competitors.
Disruptive Potential: AI has the potential to disrupt traditional business models and create new opportunities. This disruptive potential could yield high returns for investors who are able to identify the most promising AI-driven opportunities.
However, like any investment, investing in AI comes with its risks which you should consider carefully before putting money on the line. These include regulatory uncertainties, technological complexities, data privacy issues, and the potential for job displacement due to automation.
Chat GPT Stock FAQs
When will Chatgpt go public?
On June 6th of this year, at a conference held in Abu Dhabi, Sam Altman, the CEO of Microsoft-backed OpenAI—which is the organization responsible for the development of ChatGPT—stated that there are currently no plans for the company to go public in the near future.
Does OpenAI Pay Dividends?
Being a privately-held company, OpenAI does not currently distribute dividends. Typically, profits are reinvested into the company to spur further research and development.
How much did Microsoft invest in Openai?
Since 2019, Microsoft has invested $13 billion into OpenAI.
How Is OpenAI Valued?
The valuation of OpenAI is determined during private funding rounds and is influenced by various factors including market demand, technological advancements, and financial performance metrics.
Which Company Invested in ChatGPT?
OpenAI has received investments from a range of investors and corporations. Notably, Microsoft invested $1 billion in OpenAI in 2019 to form a strategic partnership, though the specifics about investment in ChatGPT specifically are not publicly disclosed.