OpenAI Acquires Ive's Startup

OpenAI is acquiring io, the device startup founded by former Apple design chief Jony Ive, in a deal valued at $6.5 billion. This marks OpenAI's largest acquisition to date, signalling a move into hardware development. Ive and his team of approximately 50 experts will join OpenAI to spearhead the design and creation of AI-integrated devices. The collaboration aims to explore novel AI applications beyond conventional software, potentially leading to screenless, context-aware AI companions.

The partnership between OpenAI CEO Sam Altman and Jony Ive began two years ago, with a shared vision of creating a new generation of AI-powered devices. Prior to the acquisition, OpenAI held a 23% stake in io. LoveFrom, Ive's independent design firm, will also collaborate with OpenAI on software design, receiving a stake in the AI company. The first products resulting from this collaboration are anticipated to launch in 2026.

This acquisition underscores the growing trend of venture-backed companies engaging in significant mergers and acquisitions to expand their capabilities and market reach. OpenAI's move to integrate hardware design expertise reflects a strategic effort to shape the end-to-end user experience of AI, potentially disrupting existing device paradigms and paving the way for innovative AI-driven products.