Microsoft has announced a deal that allows OpenAI to move away from its non-profit roots and likely go public.
Microsoft has announced a deal that allows OpenAI to move away from its non-profit roots and likely go public.
According to Reuters, such a decision is needed to finance OpenAI CEO Sam Altman’s ambitious plans for the development of data centers.
The publication explains that under this deal, OpenAI is valued at $500 billion.
At the same time, Altman himself stated that an initial public offering of shares is the most likely path for the company to grow, given how much money is needed to train and create artificial intelligence systems.
The current agreement removes major existing restrictions on OpenAI’s ability to raise capital that have existed since the previous agreement between the two companies in 2019.
After ChatGPT became wildly popular three years ago, these restrictions caused tension between the companies.
OpenAI’s new company structure will give Altman more opportunities to make deals, raise funds, and shape the broader artificial intelligence industry.
Microsoft will not have rights to any consumer hardware made by OpenAI, but even so, Microsoft will own 27% of OpenAI and remain a significant player. OpenAI will continue to share about 20% of its revenue with Microsoft for years to come, according to people familiar with the matter.
The companies said Microsoft will still own a stake of about $135 billion in OpenAI Group PBC, which will be controlled by the nonprofit OpenAI Foundation.
The deal keeps the two firms collaborating until at least 2032, with a large-scale cloud computing contract and Microsoft retaining some rights to OpenAI products and artificial intelligence models.
Previously, dev.ua wrote that OpenAI is preparing to go public, and Microsoft may give up its stake in exchange for access to the company’s AI technologies.
