OpenAI Plans to Invest Up to $1.5 Billion in Private Equity Joint Venture DeployCo

On April 23, it was reported that OpenAI is forming a joint venture named DeployCo with several private equity firms, registered in Delaware, where OpenAI holds a majority stake and super voting rights. OpenAI will initially inject $500 million in equity, with the option to add another $1 billion later; TPG, Bain Capital, Advent International, Brookfield, and Goanna Capital will contribute an additional $4 billion. DeployCo is expected to complete its financing by early May, with a valuation of $10 billion.

DeployCo is currently managed by OpenAI’s former COO Brad Lightcap, who has begun hiring staff, with OpenAI also seconding personnel. Lightcap previously led the recruitment of dozens of ‘forward deployed engineers’ to embed within client companies to assist in implementing technology, a model pioneered by Palantir.

DeployCo’s business model involves charging portfolio companies of private equity firms to help them integrate AI into their business processes. Private equity investors are locked in for five years, with OpenAI guaranteeing a minimum annual return of 17.5%; sources indicate that ‘this is the bottom line, with actual expectations much higher.’ The OpenAI equity held by DeployCo may also be used for acquiring technology and intellectual property in the future.

OpenAI executives describe the current situation as an ‘ability overhang’ in AI: the capabilities of models far exceed their actual usage. Chief Revenue Officer Denise Dresser stated in an internal sales email this month that the biggest bottleneck for enterprises using AI is not the technology itself, but ‘whether it can be deployed.’ OpenAI is also collaborating with McKinsey and Accenture to promote enterprise adoption. Anthropic is negotiating a similar joint venture with Blackstone and Hellman & Friedman to establish an AI deployment consulting firm.