ChatGPT maker OpenAI Group PBC today filed for an initial public offering ahead of what is sure to be one of the most anticipated stock market debuts in recent history, and a huge payday for early investors.

The artificial intelligence company, which is currently valued at around $852 billion, has been gearing up for a listing for some time. With its confidential filing, it’s submitting details of its finances to regulators for review before they’ll be made available publicly for prospective investors to consider. OpenAI has not settled on any timeline for its debut yet, and because its paperwork remains confidential, it’s not clear how many shares it’s planning to make available or what price it’s targeting.

In a blog post, the company said the listing may still be a few months out “because there are things we want to do that are likely easier as a private company.” However, by filing now, the company explained that it has the “option to go public sooner if that ends up being best.”

The upcoming IPO means that OpenAI’s secretive financials will finally come into public view. There has been a lot of concern raised about the company’s ability to turn its global popularity into a profit, as it continues to pour tens of billions of dollars into AI infrastructure. Last week, investors dumped on technology stocks amid concerns that the market was becoming too overheated.

OpenAI will also facilitate a tender offer for employees to be able to sell shares in the company at its current valuation. In doing this, the company will also alleviate some near-term pressure for liquidity, an anonymous source told CNN.

The ChatGPT maker is reportedly working with banks including Morgan Stanley and Goldman Sachs as it prepares its listing. Those banks were also named in SpaceX Corp.’s IPO listing, which was made public last week.

OpenAI reached its $852 billion valuation in March following a $122 billion funding round, but it has come under pressure to show that it can generate enough revenue to justify that figure. Last November, Chief Financial Officer Sarah Friar raised eyebrows when commenting that the U.S. government ought to “backstop” the company’s massive spending on AI chips and data center infrastructure, only later to walk that back.

The company has responded to that pressure by expanding its monetization options for ChatGPT, launching a lower-cost $8 tier and then introducing ads. It said at the time that it believes the cheaper subscription will help it boost its total paying customer base to more than 122 million by the end of the year. Ads are projected to become its biggest source of revenue by the end of the decade.

Meanwhile, OpenAI has sought to demonstrate that it’s not only about ChatGPT. Its other offerings include its coding bot Codex and an AI web browser, and it has also revealed plans to develop consumer hardware. Moreover, it has discussed its ambitions to transform ChatGPT into a kind of “superapp” focused on personal AI agents that can perform tasks autonomously on behalf of human users.

The company was handed a boost when it secured a courtroom victory over Elon Musk, whose AI company xAI Corp. has emerged as a major rival. Had the lawsuit gone in Musk’s favor, it could have forced OpenAI to undergo a corporate restructuring that would likely have derailed its IPO plans.

Despite that victory, OpenAI has faced stiff competition in the AI industry, especially from its chief rivals Anthropic PBC and Google LLC, whose AI chatbots have become increasingly popular with enterprise users. The company also faces more lawsuits over allegations that ChatGPT played a role in mass shootings and suicides, while it’s also the target of a growing backlash against AI technology in general.

In May, Anthropic’s valuation surged past OpenAI’s for the first time following a funding round that valued it at $965 billion, highlighting the growing rivalry between the two startups. The two companies are battling to win over both consumers and businesses, with OpenAI viewed to have the upper hand in the former segment, and Anthropic winning in the latter. Last week, Anthropic filed its own IPO paperwork, and then SpaceX publicly revealed its mega-listing plans, saying it hopes to raise as much as $75 billion from the sale.

Depending on how well SpaceX’s offering is received by investors, OpenAI and Anthropic may accelerate their listing plans to try to become the first to go public.

Photo: OpenAI