Some early investors in OpenAI are questioning the start-up's $852 billion (£628bn) valuation, amid shifts in strategy that make it appear unfocused, the Financial Times reported. The criticism comes as the company pivots toward higher-margin enterprise sales, an area where it trails behind rival Anthropic, raising fears that OpenAI could become vulnerable to competition from both Anthropic and Google.
“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 paper. This sentiment reflects a broader unease among some investors who believe OpenAI should double down on its consumer-facing strengths rather than chasing enterprise deals that require different capabilities and market positioning.
The Valuation Debate
An investor who has backed both OpenAI and Anthropic noted that an investment into OpenAI's most recent funding round would have to assume an IPO valuation of $1.2tn or more, which has become more difficult to justify given the cheaper proposition of buying into Anthropic, valued at $380bn. This stark difference highlights the premium the market has placed on OpenAI's brand and user base, but also the skepticism about whether the company can deliver on its lofty promises.
OpenAI's astronomical valuation was built on the explosive growth of ChatGPT, which reached over 100 million monthly active users within months of its launch in late 2022. The company has since raised billions of dollars from investors including Microsoft, which has invested over $13 billion. However, the path to profitability remains unclear, especially as competition intensifies and margins on consumer AI products remain thin.
Strategic Pivots Under Fire
The company's recent shifts have included shuttering its video generation tool Sora, which eliminated a $1 billion investment from Disney, scrapping plans for an “adult” chatbot, drastically paring back an investment deal with Nvidia, and halting plans to develop a $30 billion data centre in the UK and extend a site in Abilene, Texas. These abrupt reversals have left investors questioning the leadership's decision-making process and long-term vision.
OpenAI's purchase of tech talk show TBPN was also criticized by an investor as “a distraction.” While the company has not disclosed the financial terms of the acquisition, the move seemed to signal a desire to build a media presence rather than focusing on core technology. Critics argue that such diversification spreads resources too thin at a time when rivals are laser-focused on specific market segments.
The Enterprise Pivot: Chasing Anthropic
Meanwhile, the company has switched to pushing its Codex coding tool to businesses, in direct competition with Anthropic. Codex, which was initially developed as a tool for programmers, is now being repackaged as an enterprise solution for automated code generation, testing, and deployment. However, Anthropic has already established a strong foothold in this space with its Claude product, which is designed with safety and reliability for enterprise use cases.
Many enterprise customers value stability, security, and integration capabilities over raw innovation. OpenAI's reputation for rapid product iteration and occasional public missteps — such as the temporary suspension of ChatGPT's browsing feature or controversies around data privacy — may hinder its ability to win large corporate contracts. In contrast, Anthropic has purposely built a brand focused on safe AI deployment, appealing to risk-averse buyers in finance, healthcare, and government.
Infrastructure: OpenAI's Hidden Advantage
Despite the strategic confusion, some analysts point out that OpenAI holds a strong lead over Anthropic in procuring computing resources. Through its partnership with Microsoft and access to Azure's vast cloud network, OpenAI can scale AI training and inference more cost-effectively than its smaller rival. This infrastructure advantage could be decisive in the long run, as the cost of training state-of-the-art models continues to skyrocket.
Jai Das, president of investment firm Sapphire Ventures, who is not an investor in OpenAI or Anthropic, referred to OpenAI as potentially “the Netscape of AI,” referring to the browser darling of the late 1990s that was superseded by Microsoft and eventually bought by AOL. The analogy suggests that even a dominant first-mover can be overtaken by a competitor with better execution or a superior platform strategy. For OpenAI, the risk is that its scattered focus allows a more disciplined rival to capture the most profitable segments of the market.
The Broader AI Landscape
The AI industry is currently undergoing a massive transformation, with companies like Google, Meta, and a host of startups pouring resources into developing foundation models. OpenAI's ChatGPT popularized generative AI and set off a gold rush, but the market is now maturing. Investors are increasingly looking for clear paths to revenue and profitability, rather than just user growth.
OpenAI's CFO Sarah Friar defended the company's strategy, stating that its large recent funding round shows the confidence of investors. The round, which raised $6.6 billion at a valuation of $157 billion, included participation from Thrive Capital, Microsoft, and other major funds. However, the valuation in that round was lower than the $852 billion figure cited by some analysts, which includes secondary market transactions and speculative projections.
Behind the scenes, OpenAI has also been grappling with governance issues. The company was initially founded as a non-profit research lab but later created a capped-profit arm to attract investment. In 2023, a dramatic boardroom struggle led to the temporary ousting of CEO Sam Altman, revealing deep tensions between the research and commercial sides of the organization. While Altman was reinstated, the episode eroded some investor confidence and raised questions about the company's long-term stability.
In response to the criticism, some OpenAI supporters argue that the company's scale and brand recognition give it a unique ability to experiment across multiple fronts. They point to the success of the GPT Store, which allows third-party developers to create custom chatbots, as evidence that OpenAI can build a platform ecosystem. However, others counter that without a clear strategic focus, even a platform can become a fragmented mess.
What Lies Ahead?
As OpenAI prepares for its next major product release — rumored to be an upgraded version of GPT-5 — the company faces a crucial test. It must demonstrate that it can deliver breakthrough capabilities while simultaneously executing on its enterprise and infrastructure goals. The pressure to maintain rapid growth in the consumer market remains intense, as alternative chatbots from Google (Gemini), Anthropic (Claude), and others continue to erode ChatGPT's market share.
Institutional investors are also watching closely. Any sign that OpenAI is losing its technological edge could trigger a revaluation of its shares in secondary markets. The company's ability to attract top AI talent — which is in extremely high demand — depends on its perceived trajectory. If researchers perceive OpenAI as unfocused or unstable, they may gravitate toward competitors that offer clearer missions and more predictable work environments.
The debate over OpenAI's strategy reflects a larger question facing the entire AI industry: Should companies prioritize building generic intelligence that can be applied to many problems, or should they specialize in specific verticals? OpenAI has historically championed the former approach, but its recent moves suggest it is leaning toward the latter — even if the execution has been messy.
Ultimately, the investors who are most vocal in their criticism are those who hold large stakes and have seen their unrealized gains fluctuate wildly. The tension between short-term financial returns and long-term technological ambition is not unique to OpenAI; it pervades the tech industry. However, given the scale of OpenAI's valuation and the public scrutiny it attracts, these disagreements have become unusually visible.
For now, the company continues to enjoy strong revenue growth from ChatGPT subscriptions and API usage. Its ability to maintain that growth while navigating the strategic challenges outlined by investors will determine whether the Netscape analogy becomes a self-fulfilling prophecy or merely a cautionary tale. The next few quarters will be critical as OpenAI rolls out new features, courts enterprise clients, and attempts to convince skeptics that it still knows where it is going.
Source: Silicon UK News