Photo Credit: OpenAI
OpenAI, the artificial intelligence company behind ChatGPT, said it would remain under the control of its nonprofit parent. The company also announced plans to push ahead with the restructure of its for-profit arm, allowing for more capital-raising to keep OpenAI competitive in the AI race.
“We made the decision for the nonprofit to stay in control after hearing from civic leaders and having discussions with the offices of the Attorneys General of California and Delaware,” the company announced in a blog post, adding that it would work with significant backer Microsoft, as well as regulators and nonprofit commissioners to finalize its modified plan.
The announcement follows an onslaught of criticism for its previous decision to become a for-profit company, in addition to some high-profile lawsuits. One, in particular, was filed by the company’s former co-founder and current rival, Elon Musk, who accuses OpenAI of abandoning its mission to develop artificial intelligence for the good of humanity.
OpenAI first announced in December its plans to turn its for-profit arm into a public benefit corporation structured to balance shareholder returns with social goals. This differs from a non-profit, which is singularly focused on the public good. The plan was meant to help the company raise more capital while easing restrictions binding it as a nonprofit—but the ensuing outcry and controversy led the company to rethink things.
“We believe this is well over the bar of what we need to be able to fund-raise,” said Altman during a briefing call. He noted there were no changes made to existing investor relationships.
OpenAI announced in March it would raise around $40 billion in a new funding round led by SoftBank Group at a $300 billion valuation. This round, however, was contingent on the company transitioning to for-profit status by year’s end. Altman said the AI company would still be able to receive funding from the Japanese tech firm after the impending changes.
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OpenAI to Retain Non-Profit Structure With Plans to Modify For-Profit Arm For More Capital-Raising – Digital Music News
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