OpenAI may move forward with new business structure, partnership with Microsoft, regulator says

"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."

"The company also said it has signed a new agreement with its longtime backer Microsoft that gives the software giant a roughly 27% stake in OpenAI's new for-profit corporation but changes some of the details of their close partnership. The attorneys general of Delaware, where OpenAI is incorporated, and California, where it is headquartered, had both said they're investigating the proposed changes. California Attorney General Rob Bonta's office didn't immediately respond to a request for comment Tuesday."

"OpenAI has completed its recapitalization, simplifying its corporate structure, said a blog post Tuesday from Bret Taylor, the chair of OpenAI's board of directors. The nonprofit remains in control of the for-profit, and now has a direct path to major resources before AGI arrives. AGI stands for artificial general intelligence, which OpenAI defines as highly autonomous systems that outperform humans at most economically valuable work."

OpenAI reorganized its ownership and converted its business into a public benefit corporation while maintaining nonprofit control over the for-profit arm. Delaware Attorney General Kathy Jennings approved the plan after negotiations, and California was also investigating the proposal. OpenAI signed a new agreement giving Microsoft roughly a 27% stake in the new for-profit corporation while altering details of their partnership. The company completed a recapitalization to simplify its corporate structure and positioned the nonprofit to have direct access to major resources ahead of the arrival of artificial general intelligence (AGI).

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