As OpenAI restructures, Microsoft locks in long-term gains
Story by Beatrice Nolan
Hello, Beatrice Nolan here, filling in for Jeremy Kahn, who is traveling back from the Fortune Global Forum in Riyadh today. In big AI news, OpenAI and Microsoft announced that they had reached an agreement on the future of their partnership that allows OpenAI to complete a long-awaited corporate restructuring.
The arrangement converts OpenAI’s previous for-profit arm into a public benefit corporation that can issue traditional equity and will give shareholders a potentially more prominent voice in OpenAI’s governance—two changes that were seen as critical for OpenAI to continue to raise the billions of dollars of capital it will need to build more advanced AI models, construct massive datacenters, and continue its push to become a key technology platform for consumers and enterprises.
Under the deal, the new OpenAI Group PBC will remain controlled by the nonprofit OpenAI Foundation. The nearly year-long negotiations with Microsoft, which reportedly caused significant tension between the two companies, had been OpenAI’s main obstacle to completing the restructuring. And at first glance, Microsoft appears to have extracted significant concessions from the AI lab.
As OpenAI restructures, Microsoft locks in long-term gains |
