OpenAI is changing its ownership structure to make itself more attractive to investors, according to insiders. The nonprofit, which currently controls the for-profit portion of the ChatGPT developer through its board of directors, would have to give up its majority, several people familiar with the matter said Wednesday. In addition, the cap on investor returns would be lifted.
As part of the restructuring, CEO Sam Altman will receive shares in the for-profit portion of the company, which is valued at $150 billion. “We remain focused on building AI that benefits everyone,” OpenAI said. “The nonprofit is core to our mission and will continue to exist.”
The restructuring was preceded by a management exodus
After the restructuring, this should be a minority in the for-profit part of the company, the insiders said. The details are still being negotiated. Moreover, the schedule is still unclear. The possible restructuring of the company coincides with a number of high-profile departures. On Wednesday, technology chief Mira Murati surprisingly announced her resignation. Greg Brockman, the chief executive in charge of day-to-day operations, is also on the way. In recent weeks, OpenAI co-founders John Schulman and Ilya Sutskever had resigned.
OpenAI was founded in 2015 as a non-profit artificial intelligence (AI) research institution. Four years later, OpenAI LP joined as a for-profit subsidiary, with billions invested by software company Microsoft, among others. In late 2022, the company released ChatGPT, sparking a global AI boom that continues today.
OpenAI’s unusual ownership structure was originally intended to ensure the development of “safe artificial general intelligence” (AGI). This “superintelligence” is intended to serve humanity. In November, the board initially fired CEO Altman, citing a lack of communication and loss of trust. However, the gunned-down man returned to his post a few days later.
If the nonprofit part of OpenAI gives up control of the for-profit company, it can operate as a normal startup. This suits investors well. However, critics fear that OpenAI could neglect testing for potential negative consequences of AI. The company had previously disbanded the team working on this issue.
It was initially unclear how much OpenAI stock Altman would receive as part of the restructuring. Commitments to other startups have already made him a billionaire.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
