27-12-2024 (NEW YORK) OpenAI, the artificial intelligence powerhouse, has announced sweeping changes to its corporate framework, with plans to establish a public benefit corporation (PBC) that will oversee its expanding commercial operations from next year.
The San Francisco-based company revealed on Friday that the restructuring aims to streamline investment opportunities whilst maintaining its commitment to responsible AI development. The move represents a significant departure from its current non-profit structure, which has increasingly posed challenges for securing large-scale funding.
Under the new arrangement, the existing non-profit entity will pivot to focus exclusively on charitable endeavours across healthcare, education, and scientific research sectors, complete with its own leadership team and dedicated staff.
The restructuring comes as OpenAI, creator of the renowned ChatGPT, seeks to attract substantial capital investment to fuel its ambitious pursuit of artificial general intelligence (AGI). The company’s most recent funding round, which raised an impressive $6.6 billion at a valuation of $157 billion, was notably contingent upon this structural overhaul and the removal of existing profit limitations for investors.
“The scale of capital required has exceeded our initial projections,” the Microsoft-backed enterprise stated in its official announcement. “While investor interest remains robust, the magnitude of funding necessitates conventional equity arrangements rather than bespoke structures.”
The reformed entity will be incorporated in Delaware, following a model similar to AI competitors Anthropic and Elon Musk’s xAI. OpenAI’s non-profit arm will maintain involvement through share ownership in the new PBC, with independent financial advisers determining fair valuation terms.
