Altman gave up his equity. Behind OpenAI's $500 billion share reform, what exactly has changed?
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Author: Fan Liang
On the evening of October 28th, Beijing time, OpenAI officially announced the completion of the capital structure reorganization of its for - profit entity, taking a big step from the controversial "profit - cap" model towards a mature commercial entity - a Public Benefit Corporation (PBC).
This milestone - like transformation has removed key obstacles for OpenAI's future financing and IPO. By simplifying the equity structure and clarifying investors' rights, OpenAI has completely lifted the constraints of the "profit - cap" model, enabling shareholders to share the company's growth dividends according to their shareholding ratios, marking a huge leap towards a mature commercial entity. Specifically, there are two major changes in OpenAI's equity reform this time:
1. Company's "Status": From a "Special Workshop" to a "Regular Big Company"
The original non - profit entity, OpenAI Inc., has been renamed the OpenAI Foundation; the for - profit entity has been changed from OpenAI Global, LLC to the Public Benefit Corporation OpenAI Group PBC. At the same time, the equity structure has been greatly simplified, changing from the previous multi - level nesting to direct shareholding by the OpenAI Foundation, Microsoft, other investors, and employees.
It is worth noting that OpenAI disclosed that Altman does not have any equity in the reorganized company, indicating that his interests are highly aligned with OpenAI's public - welfare mission of promoting the widespread use of technology, rather than pursuing personal wealth growth, which also conforms to the original intention of OpenAI to establish a Public Benefit Corporation.
Chart by 36Kr
2. Profit - Sharing Method: From "Fixed Bonuses" to "Unlimited Dividends"
In the past, OpenAI's investors and employees could only obtain limited profits equivalent to a multiple of their investment. Now, they will directly receive dividends according to their equity ratio in OpenAI Group PBC. The dividend amount is directly linked to the company's profitability without an upper limit, which is more motivating for employees. What remains unchanged is OpenAI's control. After the equity reform, although the OpenAI Foundation only holds about 26% of the equity in OpenAI Group PBC, it exclusively holds special voting rights and governance rights, can appoint all members of the OpenAI Group board of directors, and can replace directors at any time, ensuring the OpenAI Foundation's absolute control over the Public Benefit Corporation. Although Microsoft holds about 27% of the equity in OpenAI Group PBC, it only has the right to receive dividends and cannot participate in OpenAI's daily decision - making. Overall, OpenAI's capital structure reorganization this time has clarified the structure, defined the interests, and brought potential huge financing capabilities, further raising the threshold of the AGI competition.
Chart by 36Kr