NewsBytes
    Hindi Tamil Telugu
    More
    In the news
    Narendra Modi
    Amit Shah
    Box Office Collection
    Bharatiya Janata Party (BJP)
    OTT releases
    Hindi Tamil Telugu
    NewsBytes
    User Placeholder

    Hi,

    Logout

    India
    Business
    World
    Politics
    Sports
    Technology
    Entertainment
    Auto
    Lifestyle
    Inspirational
    Career
    Bengaluru
    Delhi
    Mumbai

    Download Android App

    Follow us on
    • Facebook
    • Twitter
    • Linkedin
    Home / News / Business News / OpenAI considers for-profit status with equity for CEO Sam Altman
    Summarize
    Next Article
    OpenAI considers for-profit status with equity for CEO Sam Altman
    OpenAI's transition aims to attract outside investors

    OpenAI considers for-profit status with equity for CEO Sam Altman

    By Mudit Dube
    Sep 26, 2024
    10:22 am

    What's the story

    OpenAI, the artificial intelligence research lab, is undergoing a significant transition from its non-profit roots. The change comes in the wake of CTO Mira Murati's sudden exit.

    As part of this shift, CEO Sam Altman is expected to acquire equity in the company for the first time.

    According to Reuters, OpenAI is planning to restructure into a for-profit benefit corporation similar to competitors like Amazon-backed Anthropic and Elon Musk's xAI.

    Restructuring details

    OpenAI's transition aims to attract outside investors

    The restructuring process is still under discussion, with many details yet to be finalized.

    The non-profit OpenAI board, currently in charge of the company's for-profit operations, will give up control but maintain a minority stake in the new entity.

    This move is designed to make OpenAI more appealing to external investors who have previously been dissatisfied with the company's cap on returns.

    Equity acquisition

    Altman could receive 7% equity stake post-restructuring

    As part of the restructuring, Altman is reportedly set to receive a 7% equity stake in OpenAI.

    This would mark a significant departure for Altman, who had not previously held equity due to the company's non-profit status.

    The transition follows a series of high-level departures from the company, including that of Murati as well as top research executives.

    Earlier this year, co-founders John Schulman and Ilya Sutskever exited the AI firm.

    Criticism and response

    Musk criticizes OpenAI's shift to for-profit structure

    Musk, an early backer and one of the co-founders of OpenAI, has publicly criticized the company's transition to a for-profit structure.

    On social media platform X, Musk accused OpenAI of misleading people and straying from its original mission of developing AI for humanity's benefit rather than profit.

    In response to Murati's departure and the ensuing criticism, Altman expressed his appreciation for her contributions and assured that transition plans would be communicated with employees soon.

    Company evolution

    OpenAI's journey and future fundraising plans

    OpenAI was established in 2015 as a non-profit research organization, aiming to create safe and beneficial AI.

    In 2019, it formed a for-profit subsidiary to fund the high costs of AI model development.

    Since then, it has attracted billions in outside investment from entities like Microsoft.

    Bloomberg recently reported that OpenAI is currently seeking to raise $6.5 billion at a $150 billion valuation, positioning it as one of the world's most valuable start-ups.

    Facebook
    Whatsapp
    Twitter
    Linkedin
    Related News
    Latest
    OpenAI
    Sam Altman

    Latest

    Google's latest tool can identify content generated by AI  Google
    Google finally launches Wear OS 6 with Material 3 design Google
    Google's Gemma AI model family gets new addition: What's special? Google
    You can now use Google's Gemini AI assistant in Chrome Google

    OpenAI

    Ex-Google CEO blames remote work for company's AI innovation gap Google
    'Zero filters': Musk's AI chatbot generates violent depictions, child pornography ChatGPT
    OpenAI blocks Iranian attempts to manipulate US election using ChatGPT ChatGPT
    AI unicorn, backed by Google and Amazon, faces copyright battle Anthropic

    Sam Altman

    Hours after Ilya Sutskever's depature, another top OpenAI executive resigns OpenAI
    OpenAI CEO Sam Altman expresses discomfort with newfound fame OpenAI
    South Korea, UK set to co-host second global AI summit Elon Musk
    Scarlett Johansson vs OpenAI: The controversy around using 'her' voice ChatGPT
    Indian Premier League (IPL) Celebrity Hollywood Bollywood UEFA Champions League Tennis Football Smartphones Cryptocurrency Upcoming Movies Premier League Cricket News Latest automobiles Latest Cars Upcoming Cars Latest Bikes Upcoming Tablets
    About Us Privacy Policy Terms & Conditions Contact Us Ethical Conduct Grievance Redressal News News Archive Topics Archive Download DevBytes Find Cricket Statistics
    Follow us on
    Facebook Twitter Linkedin
    All rights reserved © NewsBytes 2025