Some early investors in OpenAI are publicly questioning the company’s $852 billion valuation, according to a report that highlights growing unease over what they perceive as an unfocused strategy. The artificial intelligence startup, which catapulted to fame with ChatGPT, is increasingly pivoting toward higher-margin enterprise sales—a move that critics say leaves it vulnerable to rivals like Anthropic and Google.
“You have ChatGPT, a 1 billion-user business growing 50-100% a year, what are you doing talking about enterprise and code? It’s a deeply unfocused company,” one unnamed early backer told the Financial Times. This sentiment reflects a broader frustration among some of OpenAI’s earliest supporters, who argue that the company should double down on its consumer chatbot success rather than chasing a market where it already trails behind competitors.
OpenAI’s journey began in 2015 as a nonprofit research lab with a mission to ensure artificial general intelligence benefits all of humanity. In 2019, it transitioned to a “capped-profit” model to attract investment, raising billions from Microsoft and other partners. The launch of ChatGPT in late 2022 sent its valuation skyrocketing, but recent strategic shifts have sparked doubt. The company has shut down its video generation tool Sora, which had been on track to secure a $1 billion investment from Disney, and scrapped plans for an “adult” chatbot. It also drastically pared back a deal with Nvidia and halted development of a $30 billion data center in the UK, while pausing expansion at a site in Abilene, Texas.
Investor Concerns
The most vocal critics are early backers who feel the startup has lost its focus. “An investment into OpenAI’s most recent funding round would have to assume an IPO valuation of $1.2 trillion or more,” said an investor who has backed both OpenAI and Anthropic. Such a valuation is becoming harder to justify, they argue, especially given the cheaper proposition of buying into Anthropic, now valued at $380 billion. Anthropic was founded by former OpenAI employees who left due to disagreements over the company’s direction and safety practices. Its flagship product, Claude, has gained significant traction in enterprise settings, where it is seen as more reliable and customizable than ChatGPT.
OpenAI’s purchase of tech talk show TBPN was also criticized as “a distraction” by an investor. The acquisition, which cost several hundred million dollars, has not yet yielded clear strategic benefits. Meanwhile, the company’s CFO, Sarah Friar, has defended the strategy, pointing to the massive funding round the company just closed as a sign of investor confidence. “We are building for the long term,” she said in a statement. “Our investors understand the magnitude of the opportunity.”
Strategic Pivot to Enterprise
OpenAI’s renewed push centers on Codex, a coding tool designed for businesses, which directly competes with Anthropic’s enterprise offerings. The company is also expanding its enterprise sales force and introducing tiered pricing for corporate clients. However, this pivot comes at a time when Anthropic already holds a commanding lead in the enterprise market, particularly among developers and financial institutions. Google, with its Gemini model, is also aggressively targeting the same customers.
Jai Das, president of investment firm Sapphire Ventures, who is not an investor in either company, described OpenAI as potentially “the Netscape of AI.” He was referring to the 1990s browser pioneer that dominated early web usage but was eventually supplanted by Microsoft’s Internet Explorer and later acquired by AOL. The analogy suggests that OpenAI’s early lead may not be sustainable if it fails to adapt or focus its efforts.
Cancelled Projects Raise Questions
The cancellation of several high-profile initiatives has further eroded confidence. Sora, OpenAI’s video generation tool, had wowed analysts with its ability to create realistic short clips from text prompts. The anticipated Disney partnership would have provided both cash and credibility, but internal disagreements over safety and commercial viability led to the project’s shutdown. Similarly, the so-called “adult” chatbot project was shelved after public outcry and regulatory warnings. The Nvidia investment was scaled back from an initial $10 billion to just $2 billion, while the UK data center plans were put on hold indefinitely. These moves have led some to question whether OpenAI’s leadership is capable of executing on its ambitious roadmap.
Comparison to Anthropic
Anthropic, founded in 2021 by Dario and Daniela Amodei and other former OpenAI researchers, has positioned itself as the safer, more transparent alternative. Its Claude model emphasizes interpretability and red-teaming, attracting enterprise clients in finance, healthcare, and legal sectors. Anthropic’s valuation, though lower, is based on actual recurring revenue from enterprise contracts. In contrast, OpenAI’s $852 billion valuation is largely driven by consumer growth and speculation about future monetization. The investor who backs both companies noted that paying 2.2 times more for OpenAI than for Anthropic is hard to justify when Anthropic is already winning the enterprise race.
OpenAI does hold one significant advantage: access to computing resources. The company has secured massive cloud computing capacity from Microsoft, including exclusive use of some Azure clusters optimized for AI workloads. This infrastructure lead allows OpenAI to train models faster and at a larger scale than Anthropic, which relies on a mix of cloud providers. However, critics argue that raw computing power is only part of the puzzle; without a coherent strategy, even the best hardware cannot guarantee market dominance.
OpenAI’s Infrastructure Advantage
OpenAI’s partnership with Microsoft has been a double-edged sword. On the one hand, it provides virtually unlimited compute and distribution via Microsoft’s cloud and office products. On the other hand, it has made OpenAI dependent on a single provider, and some investors worry that Microsoft could eventually develop its own advanced models, reducing its reliance on OpenAI. The recent cancellation of the Texas data center expansion suggests that OpenAI may be reassessing its infrastructure strategy, possibly to reduce costs or shift to more efficient designs.
Despite the criticism, OpenAI continues to grow its consumer user base. ChatGPT now has over 1 billion monthly active users, and revenue from subscriptions and API usage is climbing. The company’s lead in generative AI remains substantial, but it is facing increasing competition from open-source models such as Meta’s Llama and from startups like Mistral AI. The enterprise pivot may be an attempt to diversify revenue before margins in the consumer market compress.
Valuation Pressure
The pressure on founder Sam Altman has intensified as the company’s strategy becomes less predictable. Altman, who was briefly ousted in November 2023, has returned with a mandate to accelerate commercialization. However, the recent moves suggest a board and leadership team that is still debating priorities. Some industry insiders argue that the $852 billion valuation was always speculative, based on hopes that OpenAI would dominate both consumer and enterprise AI. Now that it appears to be struggling to win in either segment, the thesis weakens.
If the company cannot convince investors that it has a clear path to generating sustained enterprise revenue at scale, the next funding round may come at a lower valuation. That could trigger a downward spiral, as employee stock options become less valuable and talent begins to leave. Already, several high-profile researchers have departed for Anthropic or launched their own startups. The challenge for OpenAI is not merely technical but strategic: it must decide whether to be a consumer AI giant, an enterprise AI provider, or something else entirely. Until it makes that choice clear, the criticism from early investors is unlikely to subside.
Source:Silicon UK News