BENGALURU – OpenAI, the artificial intelligence research lab behind chatbot ChatGPT, is in talks to sell existing shares in a tender offer that would value the company at about US$29 billion (S$39 billion), the Wall Street Journal (WSJ) reported on Thursday, citing people familiar with the matter.

Venture capital firms Thrive Capital and Founders Fund are in discussions to invest in the deal, which would include the sale of at least US$300 million worth of shares from existing investors such as employees, WSJ said.

The transaction would almost double OpenAI’s valuation from a tender offer in 2021 and would make it one of the most valuable US start-ups on paper despite having little revenue, the newspaper said.

Existing backers of OpenAI include Microsoft, which invested US$1 billion in the organisation in 2019. The company, co-founded by Tesla chief executive Elon Musk and Silicon Valley investor Sam Altman, makes money by charging developers to license its technology.

Microsoft, for example, is preparing to add ChatGPT to its Bing search engine, a person familiar with the matter said earlier this week, in a bid to lure users from rival Google by offering more conversational replies to queries.

OpenAI’s chatbot is a software application designed to mimic human-like conversation based on user prompts and can respond to a large range of questions while imitating human speaking styles.

The company expects business to surge as it pitched to investors saying the organisation expects US$200 million in revenue in 2023 and US$1 billion by 2024, Reuters reported in December.

OpenAI and Thrive Capital declined to comment, while Founders Fund did not immediately respond to a Reuters request for comment. REUTERS, BLOOMBERG