OpenAI, the organization behind ChatGPT, is reportedly planning a major overhaul of its business model that would see it change from non-profit control to having equity and for-profit structure, for the first time giving equity to CEO Sam Altman. Sources close to the matter said the company is seeking to become a benefit corporation, which would attract more investors by removing non-profit’s control over a for-profit subsidiary. OpenAI’s non-profit arm will continue to exist but will have a minority stake with less impact.
The proposed changes signify the company’s wish to eliminate the cap on returns for investors and increase its valuation, which could go up to $150 billion. Altman, who originally did not take equity so as to keep an unengaged board control, will now be taking an equity stake as part of this restructuring.
This action is a component of OpenAI’s larger governance reform. With the departure of CTO Mira Murati and the exit of President Greg Brockman, leadership changes have already started. These developments coincide with the reorganization, which denotes a strategic realignment for the business that rose to international prominence with the introduction of ChatGPT in 2022.
Because to ChatGPT’s enormous success—it currently has over 200 million weekly active users—OpenAI’s worth has soared from $14 billion in 2021 to $150 billion. The quick expansion of OpenAI has caught the attention of investors like Thrive Capital and Apple.
Even while the reorganization might draw in additional investors, worries about the governance and safety of AI remain. The goal of developing safe artificial general intelligence (AGI) was the driving force behind OpenAI’s initial non-profit organization. As the organization transitions to a more traditional organizational structure, concerns about upholding responsibility in its development of artificial intelligence surface.