New structure gives tech giant a 27% holding in OpenAI
OpenAI has completed a major restructuring, transforming into a for-profit entity called OpenAI Group. The move gives Microsoft a 27% stake, valued at approximately $135 billion, and contributes to its rise past a $4 trillion market capitalization.
This shift ends a longstanding debate over OpenAI’s governance and financial model. Originally launched as a nonprofit in 2015, OpenAI now aims to raise significant capital to support its development of artificial general intelligence (AGI) and prepare for a potential IPO.
Nonprofit retains control amid equity expansion
While Microsoft becomes the largest individual shareholder, OpenAI’s nonprofit arm—now the OpenAI Foundation—will retain control of board appointments. The Foundation holds 26% of equity, with employees and other investors holding the remaining 47%.
The restructuring also opens the door to equity participation for backers such as SoftBank, Thrive Capital, Andreessen Horowitz, and Sequoia Capital. Previously, these investors only received a share of profits.
Partnership with Microsoft redefined
Under the new agreement, Microsoft will maintain access to OpenAI models until 2032. OpenAI has also pledged to spend $250 billion on Microsoft’s cloud services over time. However, Microsoft has relinquished its exclusivity rights as OpenAI’s sole cloud provider and given up its ability to block acquisitions or new security issuances.
A separate panel, yet to be formed, will assess whether AGI has been achieved. Microsoft will retain access to research methods until 2030 or until AGI is verified, whichever comes first.
IPO plans and public listing under consideration
CEO Sam Altman confirmed that an IPO is the “most likely path” for OpenAI, though no specific timeline has been announced. Nvidia CEO Jensen Huang said a public offering could come as early as next year, calling it potentially “one of the most successful” IPOs in history.
The new structure has received approval from regulators in both Delaware, where OpenAI is incorporated, and California, where it is headquartered.
Focus areas for the nonprofit foundation
Moving forward, the OpenAI Foundation will direct efforts toward funding AI-related research in healthcare, disease prevention, and developing robust AI resilience measures. Its board will ensure that OpenAI Group continues to align with the original mission of ensuring AGI benefits all humanity.
While the restructuring formalizes OpenAI’s shift into a traditional tech enterprise, it also clarifies governance, funding mechanisms, and partnership terms in what remains one of the most closely watched ventures in artificial intelligence.
