OpenAI has abandoned plans to restructure as a for-profit entity in a major victory for Elon Musk.
The decision means that the nonprofit board, the same one that briefly fired CEO Sam Altman in 2023, will stay in control of the organization.
After Altman’s sudden firing and return last year, the company announced plans to turn it from a public-benefit corporation to a for-profit entity.
The decision represents a major victory for Elon Musk.
Musk, who co-founded OpenAI with his own investment, strongly opposed the changes and filed lawsuits to block it from happening.
He also led a group of investors in trying to buy the company and wrestle control from Altman.
Group of Investors Led by Elon Musk Make a $97.4 BILLION Bid for OpenAI
OpenAI now says it won’t go through with the changes after holding talks with leaders and officials in California and Delaware.
“I think it just sets us up to be a more understandable structure,” Altman said at a press conference.
“This is maybe less eventful than people were expecting.”
Wow.
OpenAI couldn’t convert to a for profit, will stay under non-profit control pic.twitter.com/dZ3hUIFOog
— Sheel Mohnot (@pitdesi) May 5, 2025
Since its foundation in 2015, OpenAI has been controlled by a nonprofit board.
When the company required more money, it created a for-profit arm that could take private investors, including Microsoft.
However, investor profits were limited to 100 times what they put in and could even be cut to zero if the board decided it was necessary.
4 facts about our structure:
-OpenAI will continue to be controlled by the current nonprofit
-Our existing for-profit will become a Public Benefit Corporation
-Nonprofit will control & be a significant owner of the PBC
-Nonprofit & PBC will continue to have the same mission
— OpenAI (@OpenAI) May 5, 2025
With the new setup, the for-profit arm will return to being a public-benefit company, like some of OpenAI’s rivals, including Musk’s X.ai and Anthropic.
Scam Altman is at it again
— gorklon rust (@elonmusk) April 10, 2025
Altman added that the nonprofit could become one of the richest and most powerful organizations in the world.
“It also means we can start deploying capital from the nonprofit very soon, which we’re thrilled to do,” he continued.
“We’ve got a long list of things that we think will be very impactful.”
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