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Sam Altman told OpenAI staff in their weekly meetings that the company plans to change its rather complicated nonprofit legal entity structure next year. luckThe CEO said OpenAI would move away from nonprofit management and toward a more traditional for-profit organization. He did not elaborate on how the company would achieve that goal or what OpenAI’s corporate structure would be exactly. A spokesperson said: luck “Focused on building AI that benefits everyone,” and that the nonprofit will ” [its] The mission will continue to exist.”
OpenAI started as a donation-funded non-profit organization in 2015. Explain its structureThe company said it had raised just $130.5 million in total in donations over the past few years, making it clear that “donations alone are not enough to cover the cost of the computing power and manpower required for development.” [its] The organization, which was purely a nonprofit at the time, created a for-profit subsidiary to solve the problem. luck To explain, OpenAI’s nonprofit currently controls the for-profit arm, which in turn controls a holding company that receives investments from companies like Microsoft.
The structure places a cap on how much profit OpenAI can distribute to investors, including Microsoft. Any profits OpenAI makes above that cap go to the nonprofit sector. And the company says its revenues are soaring. information It went public in June. OpenAI reportedly doubled its annual revenue in the first half of this year thanks to the subscription version of ChatGPT.
The company’s complicated structure meant that OpenAI’s nonprofit board could remove Altman from the board in 2023. [have] “I remain confident in my ability to continue leading OpenAI,” he said. But five days later, the board was dissolved and replaced, with Altman returning as CEO.
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