Elon Musk, who wildly overpaid to acquire Twitter, is now trying to wildly underpay for his proposed takeover of OpenAI, On The Money has learned.
Tech deal bankers say Musk’s $97.4 billion bid this week for Open AI is a pittance of its real value, and consider the offer somewhat of a head-scratcher for a guy who spent $44 billion on Twitter (now named X), a social-media platform that based on its ad revenues and ability to generate money from content creators is worth closer to $4 billion.
The low-ball offer wasn’t lost on Musk’s tech-nerd rival, OpenAI chief Sam Altman, who after hearing the news took to the Musk-owned platform, played with the decimal on the offer, and wrote: “No thank you but we will buy Twitter for $9.74 billion if you want.”
Let’s just say Musk and Altman aren’t tight. The tech bros created OpenAI a few years back, and then had a falling out. Musk split and sued Altman, claiming that Sammy reneged on OpenAI’s purpose; it’s a non-profit designed to make the world a better place but he says Altman is using it as a vehicle to get rich, he alleges.
Yes, it’s all a little rich coming from the world’s richest man.
So how much is OpenAI worth? The potential of its revolutionary technology — to advance science, medicine and tech — is real, and it’s definitely worth more than the two Twitters-plus Musk is offering, bankers say. Altman is working on a plan to turn the whole shabang into a for-profit company, and based on the valuation of a round of funding it’s completing, OpenAI would be worth more than $300 billion.
That said, never underestimate Musk. He’s a guy who really does live up to the old cliche and plays three-dimensional chess. Most recently, he’s said to be working day and night on President Trump’s DOGE project, sleeping on the floor of his office while exposing federal government waste.
No wonder bankers call him “Crazy Elon” for stuff like this and because he manages by his very volatile gut, like making an outrageously high bid for Twitter, trying to get out of the deal, and then using his enormous wealth from running EV company Tesla to plunk down the cash.
And yet, he usually ends up on his feet. Tesla was near death a few years back, but he worked day and night to iron out production issues and it now has a market value of over $1 trillion. Musk is worth close to $400 billion.
After breaking up with Altman in the battle for control of OpenAI a few years ago, he started developing a rival, named xAI, with its own chatbot named Grok. Bankers tell me he uses Twitter to support Grok, essentially scouring the social-media platform for information to feed into Grok’s systems, meaning X might indeed pay for itself.
His suit against ChatGPT maker seems to follow a familiar playbook: Throw an offer at OpenAI’s funders to raise doubts about its hefty valuation, ramp up the legal pressure on Altman alleging that he is playing fast and loose with his current nonprofit status, and continue to troll his rival nerd in court and on X.
The latter is the real fun part for Crazy Elon, people who know him tell me.
When Altman told him to pound sand over his bid, Musk shot back with a one-word mean tweet: “Swindler.”