OpenAI wants to now focus on building AI that serves everyone, not just investors
But, the move could have implications for the massive funding SoftBank recently pledged.
It appears that OpenAI is bowing to regulatory pressure from Elon Musk’s ongoing lawsuit and criticism from ex-employees.
The ChatGPT maker, which had been gearing up to shift from its nonprofit roots into a full-blown for-profit business, aiming to become a public benefit corporation (PBC), a hybrid designed to balance profit-making with a social mission, is making a u-turn.
CEO Sam Altman’s vision was to turn OpenAI into a global AI powerhouse, giving it the freedom to scale fast, attract major investors, and push the tech frontier while keeping ethical guardrails in place.
And honestly, the move made sense– at least to him. Training cutting-edge models like GPT-4 costs hundreds of millions, if not billions, and operating as a standard for-profit company makes it much easier to attract deep-pocketed investors looking for returns. OpenAI, founded in 2015 as a nonprofit focused on the public good, already stretched the model in 2019 by launching a “capped-profit” arm. Moving to a PBC seemed like the natural next step, especially after its record-breaking $40 billion funding round, led by SoftBank.
Louis Eriakha
But in a surprise twist, OpenAI slammed the brakes. Amid rising legal pressure, including Elon Musk’s ongoing lawsuit, plus criticism from ex-employees and added regulatory scrutiny, the company now says its nonprofit board will remain firmly in control, even as it tweaks its for-profit side. The goal, according to OpenAI, is to keep its original mission front and centre: building AI that serves everyone, not just investors.
This reversal could have big money implications. SoftBank’s investment deal allows it to trim its $30 billion investment down to $20 billion if restructuring doesn’t go as planned. OpenAI insists the new setup won’t derail its funding goals, but there’s still some uncertainty hanging over the talks.
Meanwhile, OpenAI’s key partner, Microsoft, is also seeing changes. New reports from The Information say OpenAI plans to cut Microsoft’s revenue share from 20% to 10% by 2030—a move that could rebalance financial power between the two. Microsoft, which has poured tens of billions and holds exclusive rights to OpenAI’s APIs on Azure, is reportedly keeping a close watch on the revamped structure.
Acquah Nana Yeboah
All eyes are now on what this means for the AI industry at large. Competitors like Anthropic and xAI are keeping watch, and the bigger question remains: can OpenAI continue to scale cutting-edge AI while keeping its ethics—and its investors—on board? If nothing else, this latest plot twist proves that leading the AI race is as much about navigating business models as it is about tech breakthroughs.
