OpenAI for-profit shift: Sam Altman to get 7% equity

OpenAI is planning on granting CEO Sam Altman a 7% equity stake as part of a broader shift towards becoming a for-profit entity, according to a recent report by Bloomberg. This move marks a significant change for the artificial intelligence (AI) firm, which had, until now, adhered to its roots as a nonprofit organisation aimed at advancing AI for public interest.

The company is also considering restructuring itself into a public benefit corporation, which would allow it to pursue profit while maintaining a mission to benefit society. Discussions are still ongoing, and no firm timeline for the transition has been established, states Bloomberg.

A spokesperson for OpenAI stated that the organisation remains "focused on building AI that benefits everyone", emphasising that the nonprofit sector will continue to play a role in the company's future.

The changes come at a time of turbulence within OpenAI, with a number of high-level departures like Chief Technology Officer Mira Murati in recent months.

OpenAI's journey from a nonprofit founded in 2015 to a for-profit entity has been marked by rapid growth and increasing financial pressures. Initially set up to develop AI that could benefit humanity, the company created a for-profit subsidiary in 2019 to fund the rising costs of AI development. This shift attracted billions in investment, most notably from Microsoft. The Bloomberg report also suggests that OpenAI is raising an additional $6.5 billion, valuing the company at $150 billion.

With around 1,700 employees—more than double the workforce it had just a year ago—OpenAI is poised for continued growth. However, only three of OpenAI's 11 co-founders, including Sam Altman, remain at the company.