OpenAI says nonprofit parent will own equity stake in company of over $100 billion (www.cnbc.com)

OpenAI has announced that its nonprofit parent organization will retain oversight and own an equity stake valued at over $100 billion in the company, which was recently valued at $500 billion in a secondary share sale. This unique corporate structure positions OpenAI’s nonprofit arm as one of the world’s most well-funded philanthropic organizations, enabling the company to continue raising capital while maintaining a mission-driven governance model. The announcement underscores OpenAI’s commitment to balancing rapid commercial growth with ethical oversight, a crucial factor as the AI leader pushes forward with transformative technologies like ChatGPT. In addition, OpenAI revealed a non-binding memorandum of understanding with Microsoft, marking the next phase of their partnership. Microsoft, a key investor with over $13 billion poured into OpenAI since 2019, remains the primary cloud provider and strategic ally. The companies emphasized their shared focus on delivering safe, cutting-edge AI tools through a definitive agreement currently being finalized. OpenAI’s structure, now a public benefit corporation with nonprofit control, follows pressure from civic leaders and former employees to embed safety and social responsibility into its rapid expansion. This governance model also plays a role amid ongoing legal disputes with co-founder Elon Musk, who opposes the shift toward a for-profit framework as he competes in the generative AI space.