OpenAI is acquiring a stake in Thrive Holdings, an investment vehicle established earlier this year by Thrive Capital, one of its key investors. This move extends the list of circular transactions involving the ChatGPT maker and its backers.

Thrive Capital, founded by Joshua Kushner in 2010, is known for its concentrated, long-term investment approach. The firm pivoted toward AI recently, first investing in OpenAI in 2023 at a $27 billion valuation. Later that year, it led a $6.6 billion funding round that valued OpenAI at $157 billion—a staggering figure at the time. In April, Thrive launched Thrive Holdings, adopting a private equity-like strategy to create and acquire AI-driven companies.

Under the partnership announced on December 2, OpenAI will collaborate with Thrive Holdings to accelerate enterprise AI adoption, starting with accounting and IT services. An OpenAI spokesperson clarified that the company is not investing directly in Thrive Holdings. Instead, OpenAI will receive equity in Thrive Holdings in exchange for providing its team’s expertise to portfolio companies. The goal is to embed OpenAI employees "deeply" within these businesses to enhance "speed, accuracy, and cost-efficiency."

OpenAI COO Brad Lightcap framed the deal as a model for enterprise-AI integration: "This partnership demonstrates how cutting-edge AI can revolutionize organizational operations and customer engagement. We hope it sets a precedent for deep collaboration between OpenAI and global industries."

However, the arrangement has intensified scrutiny over circular deals in the AI sector. As tech firms race to build AI infrastructure—through equity swaps, chip purchases, or cloud contracts—investors and analysts are questioning whether complex, interlinked transactions artificially inflate the AI boom.

In this case, OpenAI gains equity in a Thrive Capital affiliate, while Thrive retains its OpenAI stake. A source familiar with the deal described it as a long-term incentive alignment. Similar arrangements include NVIDIA’s agreement to invest up to $100 billion in OpenAI to fund data centers, with OpenAI committing to deploy millions of NVIDIA chips. Weeks later, OpenAI signed a deal with NVIDIA rival Advanced Micro Devices (AMD) for billions in AMD chips, potentially making OpenAI one of AMD’s largest shareholders.

Critics argue such reciprocal deals risk creating a self-reinforcing financial loop detached from organic market demand.