Cathie Wood’s Ark Investment Management has announced that it has a stake in Silicon Valley’s artificial intelligence darling OpenAI, a bet that the emerging AI industry will reshape the technology landscape.
In an email to clients on Thursday, Ark said: “As of April 10, 2024, the Ark Venture Fund is investing in OpenAI,” referring to its $54 million VC fund. “OpenAI is at the forefront of a Cambrian explosion in artificial intelligence capabilities,” the technology-focused asset manager said within the statement.
Launched in September 2022, the Ark closed-end fund invests in each private and non-private corporations – including Elon Musk’s SpaceX, Epic Games Inc., Freenome Holdings Inc. and Relation Therapeutics.
“Our fund is relatively new and small, and for us the incremental progress in the endowment model space has been, frankly, faster than we expected,” said Brett Winton, Ark’s chief futurist and investment committee member, in an interview. “We expect there will be a $16 trillion market cap by 2030, dominated by endowment-type companies.”
OpenAI has raised huge sums of cash, most of it from Microsoft Corp., which has invested 13 billion dollars. The company has also allowed some employees to sell shares as a part of a so-called takeover offer Valuation of $86 billion. Ark said it invested in the corporate through a special purpose vehicle but declined to elaborate. OpenAI didn’t comment on the deployment.
The startup will represent about 4% of the Ark Venture Fund’s holdings, Winton said. Ark also has a stake in competitor Anthropic and holds about 5% of the identical fund.
Forest most famous Vehicle, Ark Innovation ETF, rose to prominence at the peak of the pandemic after making big bets on corporations like Tesla Inc. This 12 months, the exchange-traded fund stumbled after the electrical automobile maker’s share price fell.
The enterprise fund consists predominantly of personal corporations – around 80% of the full investments. The value of his assets is updated each dayin an effort to offer the fairest value to on a regular basis investors in Ark’s product, Winton said.
“The Sora model is stunning,” Winton said, referring to the recently released OpenAI Text-to-video generative AI tool. “The acceleration in the pace of innovation is overwhelming and that’s why we wanted to draw attention.”
