OpenAI’s Non-Profit to For-Profit Switch Could Include Equity for Sam Altman.

OpenAI, the company behind the popular AI chatbot ChatGPT, is reportedly planning to switch to a for-profit structure. This move comes with a significant new round of investments, which could elevate the company’s valuation to over $150 billion. According to sources, a component of this strategy involves granting CEO Sam Altman a yet-to-be-determined amount of equity.

The shift from a nonprofit to a for-profit benefit corporation is aimed at making the organization more appealing to investors. However, this change may raise concerns about OpenAI’s commitment to safety, particularly as the company develops AI systems with advanced reasoning capabilities. The nonprofit board that currently governs OpenAI will no longer be in charge, with the nonprofit retaining a minority ownership interest in the new for-profit division.

This restructuring follows recent turmoil within the company, including a brief uprising against CEO Sam Altman last year and a lawsuit initiated by co-founder Elon Musk. Additionally, several high-ranking executives have departed, including CTO Mira Murati, who announced her resignation today, and president Greg Brockman, who is currently on leave. Former chief Ilyautskever left the organization earlier this year.

The new for-profit structure is similar to that of OpenAI’s competitor, Anthropic. This move is part of a broader effort to enhance governance and attract more investment, which could further accelerate the development of advanced AI technologies. However, it also raises questions about the balance between profit and safety in the rapidly evolving field of artificial intelligence.

source: https://www.theverge.com/2024/9/25/24254535/openai-non-profit-for-profit-sam-altman-investment