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OpenAI wants to become a for-profit company — and give Sam Altman a lot of equity

As you may recall, in Nov of 2023 OpenAI's board ousted Sam Altman apparently because they thought he was handling the AI inappropriately. That's when Microsoft came in, injected a ton of money into the company for a share of the venture and canned the entire board. BAM...the giant Death Star wasn't about to let AI be run by a bunch of well meaning professorial pencilnecks.


OpenAI wants to become a for-profit company — and give Sam Altman a lot of equity

News of the ChatGPT maker's restructuring came amid a series of high-level executive departures at the AI startup

By Rocio Fabbro

UpdatedYesterday


OpenAI is looking to attract investors by shedding its non-profit business model.


Reuters, citing unnamed sources familiar with the matter, reports that the ChatGPT maker is reorganizing its central business into what’s known as a benefit corporation, a for-profit company with the goal of creating a positive impact on society. That also means that it won’t be controlled by its non-profit board.


Chief executive officer Sam Altman will also get what could total roughly $150 billion of equity in the newly restructured accompany, according to the Reuters. The OpenAI nonprofit will live on, however, and will hold a minority stake in the company.


OpenAI is reportedly in talks with several investors to raise billions of dollars in new funding, which would value the company at more than $100 billion. This latest funding round would be its single biggest raise since it received $10 billion in backing from Microsoft back in January 2023, and could reportedly also include investments from tech and AI giants Apple and Nvidia.


A deal allowing employees to sell stakes in the company valued OpenAI at $86 billion in late 2023, nearly triple what it was earlier in the year.


News of the company’s restructuring came just hours after chief technology officer Mira Murati announced that she would be exiting the company, marking the latest in a series of high-level executive departures at the AI startup.


Murati, who spent six-and-a-half years at the artificial intelligence startup, said Wednesday that she had “made the difficult decision” to leave and that she wants “to create the time and space to do my own exploration.” After OpenAI CEO Sam Altman was briefly ousted in November, Murati served as interim leader of the company.


OpenAI co-founder and former chief scientist, Ilya Sutskever, and researcher Jan Leike, resigned from the company in May. The pair co-led of the startup’s “superalignment” team, which was focused on AI’s existential dangers.


Critics, including former OpenAI employees, have warned that the company and its ambitions to create what’s known as artificial general intelligence, pose “serious risks.” The company said the “superalignment” team’s work would be absorbed by other research efforts across OpenAI.

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