OpenAI will acquire Statsig for $1.1 billion in an all-stock deal that appears as much about landing its founder and CEO as a new technical leader as it does about bringing the Seattle-area product testing startup into the ChatGPT maker’s fold.
The surprise announcement Tuesday morning named Statsig’s Vijaye Raji, a former Facebook engineering leader, to the newly created role of CTO of Applications for OpenAI. Raji will report to Fidji Simo, the former Instacart CEO, who was named CEO of OpenAI’s applications team earlier this year.
“As part of this transition,” OpenAI’s announcement added, “we’re acquiring Statsig, one of the most trusted experimentation platforms in the industry — powering A/B testing, feature flagging, and real-time decisioning for some of the world’s most innovative companies, including OpenAI.”
The acquisition price of $1.1 billion matches Statsig’s valuation in its latest funding round in May. The lack of a premium suggests that the startup’s investors are betting on the long-term growth potential of OpenAI’s stock.
The deal requires regulatory approval. Once the acquisition is complete, OpenAI said Statsig will continue to operate independently, from its Seattle-area office, serving its existing customers. All of Statsig’s employees are expected to have the option to transition to OpenAI as employees.
The deal is one of OpenAI’s largest acquisitions to date and comes on the heels of its $40 billion raise at a $300 billion valuation earlier this year.
Founded in 2021 and based in Bellevue, Wash., Statsig employs 155 people, with plans to expand to nearly 200 by early 2026. The startup is known for its unusual five-day-a-week in-office policy, a culture that Raji has credited with fostering speed and collaboration.
Statsig is ranked No. 5 on the GeekWire 200, our index of the region’s top startups. It moved into a new headquarters this year.
Statsig raised more than $153 million to date. Its $43 million Series B round in 2022 was led by Sequoia with participation from Madrona. The company had 31 employees at the time.
Madrona managing director S. “Soma” Somasegar, an early investor in Statsig, called the acquisition a natural fit, citing Statsig’s “world-class product velocity,” customer obsession, and in-office culture as the foundation of its success.
Somasegar wrote in a post that the startup’s data-driven approach has already made it one of the leading intelligent application companies, and predicted that joining OpenAI will allow its mission of rapid experimentation and customer focus to continue at a greater scale.
In an interview with GeekWire, Somasegar said Madrona made a bet on Statsig early on “mostly because of Vijaye.”
He said Statsig was growing and could have created more value as a standalone company, but said he was “very thrilled” about the outcome of the acquisition.
“We are shareholders of OpenAI, and we get to benefit in the rocketship now,” Somasegar said.
He also said the deal highlights the strength of Seattle’s tech ecosystem.
“It’s validation that Seattle is a hotbed of innovation and talent,” Somasegar said.
OpenAI said it opened an office in Bellevue in October and is reportedly planning to move into City Center Plaza, which was previously occupied by Microsoft. OpenAI has about 159 employees in the Seattle region, according to LinkedIn.
Related:
- OpenAI deepens Seattle-area footprint with blockbuster $1.1B acquisition of Statsig
- Is 5 days in the office key to startup success? Statsig’s big acquisition to OpenAI is a proof point.
