By Nermeen Nabil TLDR:
OpenAI is restructuring from a nonprofit to a for-profit benefit corporation
CTO Mira Murati and other executives have recently left the company
OpenAI is reportedly seeking $6.5 billion in new funding at a $150 billion valuation
CEO Sam Altman is expected to receive his first equity stake in the company
The restructuring aims to make OpenAI more attractive to investors
OpenAI, the company behind the popular AI chatbot ChatGPT, is undergoing significant changes in its corporate structure and leadership team.
The artificial intelligence research company, originally founded as a nonprofit in 2015, is reportedly planning to transition into a for-profit benefit corporation. This move comes as the company seeks to raise $6.5 billion in new funding at a valuation of $150 billion.
The restructuring process, which could extend into next year, is designed to make OpenAI more attractive to investors.
Under the proposed plan, the nonprofit arm of OpenAI will continue to exist but will hold a minority stake in the for-profit company. This shift represents a departure from OpenAI’s original mission as a nonprofit research lab dedicated to developing safe AI.
Coinciding with these structural changes, OpenAI has experienced a series of high-profile departures from its leadership team. Most notably, Chief Technology Officer Mira Murati announced her exit on Wednesday, September 25, 2024.
Murati, who had been with the company for six and a half years, played a crucial role in the development of ChatGPT and the AI image generator Dall-E. In her farewell note, Murati expressed gratitude for her time at OpenAI and stated that the timing felt right for her departure.
Following Murati’s announcement, two more senior technical staff members, Barret Zoph (VP of Research) and Bob McGrew (Chief Research Officer), also left the company. OpenAI CEO Sam Altman addressed these departures on social media, noting that while the decisions were made independently, the timing of Murati’s exit influenced the company’s decision to announce all three departures simultaneously.
These recent exits add to a growing list of departures from OpenAI’s leadership. Earlier this year, chief scientist and co-founder Ilya Sutskever left to start a new firm focused on safer AI development.
Another co-founder, John Schulman, departed in August to join rival company Anthropic. Additionally, president and co-founder Greg Brockman is currently on extended leave.
As part of the restructuring, CEO Sam Altman is expected to receive his first equity stake in the company. This move aligns with the shift towards a more traditional corporate structure and could potentially incentivize key leadership to remain with the company.
The changes at OpenAI come at a time of rapid growth and increasing competition in the AI industry. Since the public release of ChatGPT in 2022, OpenAI has seen its valuation skyrocket and has become a prominent player in the tech world.
The company recently unveiled GPT-4o, an AI model capable of human-like spoken conversations, and previewed OpenAI o1, which the company claims can reason through complex scientific and mathematical problems.
However, the restructuring and leadership changes have raised concerns among some in the AI safety community.
Critics worry that without nonprofit control, OpenAI may lack sufficient oversight in its pursuit of artificial general intelligence (AGI). The company recently disbanded its superalignment team, which focused on long-term AI risks, further fueling these concerns.
OpenAI has stated that it remains committed to its mission of building AI that benefits everyone. A company spokesperson emphasized that the nonprofit aspect of OpenAI will continue to exist and play a crucial role in the organization’s future.
The post Leadership Shake-Up at OpenAI as Company Restructures as For-Profit Entity, Seeks $6.5 Billion in Funding appeared first on Blockonomi.
Nermeen Nabil Khear