Some early investors in OpenAI are questioning the start-up’s $852 billion valuation, amid shifts in strategy that make it appear unfocused, according to recent reports. The criticism highlights growing unease among backers who fear the company is losing sight of its core strengths—consumer AI and massive user growth—as it pivots toward enterprise sales and other ventures where it trails behind rivals like Anthropic and Google.
Background on OpenAI
OpenAI was founded in 2015 as a non-profit research organization with the mission of ensuring artificial general intelligence (AGI) benefits all of humanity. The company initially focused on open-source AI development and safety research. In 2019, it transitioned to a capped-profit model, creating OpenAI LP to attract outside investment, while still governed by the non-profit. That same year, Microsoft invested $1 billion, beginning a deep partnership that has provided OpenAI with critical cloud computing resources and integration of its models into Microsoft products. The release of GPT-3 in 2020, followed by ChatGPT in late 2022, catapulted OpenAI to global prominence. ChatGPT quickly became one of the fastest-growing consumer applications in history, reaching 100 million monthly active users within two months. By 2023, OpenAI had launched GPT-4, multiple models, and services like DALL-E for image generation and Whisper for speech recognition. The company’s valuation soared, reaching $80 billion in early 2024 and later $852 billion in its most recent funding round, reflecting investor enthusiasm for the generative AI boom.
Current Strategic Shifts
Despite this growth, recent moves by OpenAI have drawn sharp criticism. The company has shifted its focus toward higher-margin enterprise sales, particularly through its Codex coding tool, which competes directly with Anthropic’s Claude models. This pivot has left some investors puzzled, as OpenAI’s flagship product, ChatGPT, continues to dominate the consumer market with over a billion users and revenue growing 50-100% annually. “You have ChatGPT, a 1 billion-user business growing 50-100 per cent a year, what are you doing talking about enterprise and code? It’s a deeply unfocused company,” an unnamed early backer told the Financial Times. Other strategic decisions have exacerbated these concerns. OpenAI shuttered its video generation tool Sora, which had been in development for months and was poised to attract a $1 billion investment from Disney. The company also scrapped plans for an “adult” chatbot after internal debate. It drastically pared back an investment deal with Nvidia, reducing what was expected to be a multi-billion dollar commitment. Additionally, OpenAI halted plans to develop a $30 billion data centre in the UK and paused expansion of a site in Abilene, Texas. The purchase of tech talk show TBPN was also criticized by an investor as “a distraction.”
Investor Concerns
Valuation pressures are mounting. An investor who has backed both OpenAI and Anthropic noted that for someone investing in OpenAI’s latest round, an IPO valuation of at least $1.2 trillion would be required to justify the risk. By contrast, Anthropic, valued at $380 billion when it raised funds in early 2025, presents a cheaper alternative. Anthropic was founded in 2021 by former OpenAI employees, including Dario and Daniela Amodei, who left due to concerns about OpenAI’s direction and safety practices. The company has since positioned itself as a more safety-focused enterprise player, with models that enterprise customers often prefer for their reliability and interpretability. OpenAI’s enterprise push, therefore, pits it directly against a nimble competitor with strong brand trust in that segment. Jai Das, president of investment firm Sapphire Ventures, who is not an investor in either company, described OpenAI as potentially “the Netscape of AI,” referencing the 1990s browser pioneer that was overtaken by Microsoft and later sold to AOL. The comparison suggests that OpenAI, despite its current dominance, could be vulnerable to larger competitors like Google or better-focused startups if it fails to maintain clear strategic priorities.
Competitive Landscape
Google has re-entered the AI race aggressively with its Gemini models, integrating them across its ecosystem. Meanwhile, Anthropic continues to win enterprise contracts with its Claude models, which are often seen as more secure and customizable. OpenAI’s attempt to sell Codex to businesses puts it in direct competition with Anthropic’s code generation features, but observers note that Anthropic has already built a strong enterprise sales force and customer relationships. OpenA's earlier lead in foundational models has eroded as competitors catch up, raising the stakes for its strategic moves. Some investors worry that the company’s focus on too many fronts—consumer, enterprise, video, audio, hardware— dilutes its ability to execute. The decision to acquire TBPN, a tech talk show, seemed particularly misaligned with core AI development. However, others point out that OpenAI still holds a significant advantage in computing resources. Its partnership with Microsoft ensures access to vast cloud infrastructure and custom chips, while Anthropic and Google are more dependent on their own or third-party capacities. OpenAI’s chief financial officer, Sarah Friar, defended the company’s strategy, emphasizing that the massive recent funding round—reportedly $40 billion led by SoftBank—demonstrates investor confidence and provides the resources needed to pursue multiple opportunities simultaneously.
Infrastructure Advantages
The computing lead is not trivial. OpenAI has secured large quantities of Nvidia GPUs and is reportedly developing its own AI chips to reduce reliance. Microsoft has integrated OpenAI models into Azure, Office 365, and Windows, creating a symbiotic relationship that benefits both companies. This infrastructure moat could help OpenAI weather strategic missteps. Yet critics argue that without a coherent product roadmap, raw computing power alone won’t sustain an $852 billion valuation. The cancellation of the UK data centre project and the scaling back in Texas suggest that even OpenAI’s massive spending faces limits. The company has cited economic conditions and shifting priorities, but investors see these as signs of indecision. Meanwhile, the enterprise segment remains contested. Anthropic’s focus on safety and customization appeals to regulated industries like finance and healthcare, while Google’s Gemini integrates seamlessly with its cloud services. OpenAI’s enterprise offerings, including ChatGPT Enterprise and Codex, have seen adoption but have not yet matched Anthropic’s growth rate in that vertical. Some analysts believe OpenAI should double down on its consumer franchise—perhaps by introducing premium tiers, advertising, or expanded use cases—rather than chasing enterprise deals where it is a late entrant. The risk, as one early investor put it, is that OpenAI becomes “a jack of all trades, master of none.”
The company’s journey from a small research lab to a global powerhouse has been remarkable, but the current strategic turbulence raises questions about leadership and vision. While CEO Sam Altman remains a charismatic figure, the board’s composition and governance have been controversial, particularly after the brief ouster of Altman in November 2023, which was reversed after employee and investor backlash. That incident exposed fractures within the organization. The recent departure of several high-profile researchers, including co-founder Ilya Sutskever, has further unsettled investors. The company’s focus on commercialization may be necessary to justify its valuation, but it risks alienating the research community that drove its early innovation. As the AI startup ecosystem matures, investors are increasingly demanding clarity and focus. OpenAI’s ability to navigate these pressures while maintaining its lead will determine whether it fulfills its lofty ambitions or suffers the fate of past tech giants that lost their way. For now, the sentiment among early backers remains mixed: some are doubling down, others are hedging with bets on Anthropic, and many are watching closely to see if OpenAI can regain its strategic footing.
Source:Silicon UK News