OpenAI completes restructuring for profit focus, Microsoft shares jump
OpenAI has worked for a long time to change its structure so that investors can get their money back. This has been achieved after the agreement with Microsoft.
(Image: Camilo Concha/Shutterstock.com)
OpenAI has completed the restructuring into a for-profit company but will continue to be controlled by a non-profit organization. The AI company announced this now, shortly after the details of the new partnership rules with Microsoft were made public. The step ends a months-long process that was torpedoed by, among others, US billionaire Elon Musk. Microsoft's stock price subsequently made a leap, allowing the software group's market capitalization to surpass the four trillion US dollar mark for the first time. Only Nvidia has achieved this before, but the semiconductor manufacturer is already approaching the five trillion US dollar mark thanks to the AI boom.
Foundation and Microsoft hold majority of shares
The non-profit organization responsible for OpenAI is now called OpenAI Foundation and holds a 26 percent stake, one percentage point less than Microsoft. It derives its influence from additional voting rights, OpenAI explains, adding that with the funds from the multi-billion dollar investment, it will become one of the best-equipped philanthropic organizations in the world. Initially, it is to be dedicated to efforts to improve healthcare with medical breakthroughs and strengthen technical resilience against AI systems. At OpenAI, it is to ensure that the desired Artificial General Intelligence (AGI) serves the well-being of humanity. Employees and investors hold 47 percent of OpenAI Group.
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OpenAI CEO Sam Altman has been pushing for the restructuring from a non-profit model to a for-profit company for months. This was intended to enable investors, who have already invested tens of billions in the AI company, to also get their money out in the long term. This was only possible to a limited extent with the old model. That the fundamental structure with an influential non-profit organization should nevertheless not be touched was clear for a long time. The Attorneys General of California and Delaware had pushed for this. Elon Musk had tried to completely prevent the process and made a takeover offer, among other things. He has his AI company with xAI.
(mho)
