In a significant development, OpenAI announced its acquisition of Jony Ive’s design firm, io, in an all-stock deal valued at $6.5 billion. The news came shortly after Sam Altman, OpenAI’s CEO, and Ive released information about the transaction.
Sebastian Siemiatkowski, the CEO of payment solutions company Klarna, shared a surprise post on X, revealing that his investment firm, Flat Capital, had invested in io six months prior. As the acquisition is conducted through stock, the shares Flat Capital held in io will now convert to equity in OpenAI’s for-profit division. Siemiatkowski expressed his enthusiasm about the investment, noting that they would receive a substantial return.
Following this announcement, Flat Capital confirmed in a public statement that io was indeed one of the companies they had invested in during their “mini-portfolio” reveal of US-based AI firms, specifying an investment of 34 million SEK (approximately $3.6 million).
Adding to the intrigue, Luke Wroblewski, a former Google designer now managing director at Sutter Hill Ventures, made headlines by tweeting congratulations to io on the acquisition. Though his post was later deleted, it hinted that Sutter Hill Ventures could potentially be a major backer of io, though TechCrunch could not verify this claim.
Reports suggest that OpenAI holds the largest stake in io, owning 23% of the company, valued at approximately $1.5 billion. Following the acquisition, it appears that OpenAI invested roughly $5 billion in stock to acquire the remaining shares of io. Other notable backers of io include Laurene Powell Jobs’ Emerson Collective, Thrive Capital, Maverick Ventures, SV Angel, and the OpenAI Fund, the latter being financed by external investors, according to various sources.
Despite deleted tweets implying otherwise, it has been confirmed that Sutter Hill Ventures was among the investors, although further details regarding their level of investment remain unclear as the firm did not respond to request for comments.
As the story unfolds, it highlights not only the growing consolidation in the AI sector but also points to the significant returns that early investors can realise through strategic acquisitions in this rapidly developing field.
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