OpenAI’s Business Structure Undergoes Major Shift Amidst Funding Round

OpenAI’s business structure, previously described as a “partnership between our original Nonprofit and a new capped profit arm,” is undergoing a significant transformation. This move comes amidst reports of a massive funding round, potentially valuing the ChatGPT maker at over $150 billion. As part of the new structure, OpenAI will transition to a for-profit benefit corporation, similar to its rival, Anthropic.

According to Reuters sources, the new plan includes granting CEO Sam Altman equity for the first time. This shift will see the non-profit board relinquish control, making the company more appealing to investors. The non-profit arm will retain a minority ownership stake.

This change, while potentially attracting significant investment, may raise concerns regarding OpenAI’s focus on safety versus profit. As the company pursues AI models capable of reasoning, the shift towards a for-profit model could impact its approach to ethical considerations.

Altman’s letter upon his return as CEO last November alluded to “improving our governance structure,” a goal that seems to be taking shape. This coincides with the departure of several key executives, including CTO Mira Murati, who announced her exit today. President Greg Brockman is reportedly on leave, and former chief scientist Ilya Sutskever left the company earlier this year.