US EditionMicrosoft, OpenAI reach new deal to allow OpenAI to restructure
- On Oct 28, OpenAI completed its recapitalization, creating a for-profit entity within a non-profit foundation, and Microsoft will hold roughly 27% of OpenAI Group, valued at about $135 billion.
- Operating constraints and fundraising needs pushed the change as OpenAI's nonprofit equity limits became untenable, governance tensions including the November 2023 board episode exposed instability, and Softbank's $30 billion conditional investment increased pressure to restructure.
- Under the new legal structure, the OpenAI Foundation will control OpenAI Group, own 26% of the for-profit, require AGI claims be verified independently, and commit to $250B of Azure services.
- Microsoft shares reacted, rising 2.5 per cent, with its market value surpassing $4 trillion, while Altman scheduled a livestream amid ongoing inquiries from California and Delaware attorneys general.
- The agreement binds the firms through at least 2032 via cloud and rights arrangements, allowing Microsoft to pursue AGI alone or with partners amid ChatGPT's more than 700 million weekly users.
74 Articles
74 Articles
Microsoft Buys 27% Of OpenAI; Nonprofit Retains Control And Sets AGI Rules
OpenAI has rebuilt itself for the next decade. The company now runs as a for-profit public-benefit corporation, but control stays with the OpenAI Foundation—the nonprofit created to keep the mission front and center. Microsoft, the long-time partner that supplied most of the money and computing power, now holds a 27% stake. The foundation itself holds […]
The Mercury news
OpenAI may move forward with new business structure, partnership with Microsoft, regulator says
By MATT O’BRIEN and THALIA BEATY OpenAI said Tuesday it has reorganized its ownership structure and converted its business into a public benefit corporation and a crucial regulator, the Delaware attorney general, said she approved the plan. The restructuring paves the way for the ChatGPT maker to more easily profit off its artificial intelligence technology even as it remains technically under the control of a nonprofit. Delaware Attorney Genera…
So far it had a hybrid structure similar to a foundation: the goal of this choice is to attract even more money
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