After getting epically roasted by an upstart competitor, OpenAI is seemingly refusing to reevaluate its approach, asking investors to close their eyes and give them another $40 billion anyway, pretty please.As the Wall Street Journal reports, the Sam Altman-led company is in early talks for a new round of funding that would value it at a gargantuan $340 billion which would put it among the 30 biggest companies in the world by market cap, not to mention more than twice the $157 billion it was valued at in October.Despite its sky-high valuation, it bears repeating that OpenAI isn't expected to make virtually any profit until 2029, at the very earliest and even that's a highly optimistic read of the situation, given the many shortcomings still plaguing the tech.For evidence, look no further than theWSJ's diplomatic phrasing: the "startup also expects to use the cash to fund its money-losing business operations."OpenAI is looking to raise funds at least in part to fulfill its promise of committing roughly $18 billion to president Donald Trump's shiny AI infrastructure initiative. The project, dubbed Stargate, is aiming to raise as much as half a trillion dollars in a matter of four years plans that were met with plenty of skepticism.Fellow Stargate signee SoftBank is said to lead OpenAI's latest round of funding, contributing anywhere from $15 to $25 billion, according to the WSJ.The timing of the latest revelation is striking, to say the least. Earlier this week, a new hyper-efficient model by Chinese AI startup DeepSeek flipped the entire AI industry on its head, triggering amassive tech selloff that wiped out over $1 trillion in market capitalization.The company's latest "reasoning" AI model, dubbed R1, caught investors by surprise, demonstrating that the proficiency of OpenAI's most powerful models can be matched at a tiny fraction of the cost.DeepSeek's efforts clearly challenged OpenAI's modus operandi, demonstrating that stuffing as many billions of dollars as possible into massive data centers for extremely power-hungry models may not be the most economically savvy approach.Is the latest round of funding yet another warning sign of staggering bloat suffocating the AI industry and limiting innovation? Investors are bound to have a very close look before committing even more cash, following this week's immense financial and logistical reality check.It certainly wouldn't be the first major misstep for SoftBank. The company has a troubled history with past investments remember WeWork? posting a record $32 billion loss for its Vision Fund in 2023, for instance.In short, OpenAI just doubled its already lofty stack of chips, vowing to go all in. Altman has promised that OpenAI will "obviously deliver much better models" than DeepSeek, without giving any more details."But mostly we are excited to continue to execute on our research roadmap and believe more compute is more important now than ever before to succeed at our mission," he added in a Monday tweet.Put differently, Altman is fully committed to pumping as much money into AI datacenter infrastructure as possible efficiency, environment, and economic edge be damned."The world is going to want to use a LOT of AI, and really be quite amazed by the next-gen models coming," he wrote.Share This Article