In order to make a bigger effect on the world, OpenAI, a huge AI startup worth about $157 billion, wants to become a public benefit corporation, or B-Corp.
OpenAI said it wants to turn holding stakes in its business into ordinary shares, or common shares of stock, but it didn’t give a time frame. This structure points the way toward the company becoming a publicly traded one.
“Once more, we need to raise more money than we thought,” the group wrote on its blog late Thursday. “Investors want to help us, but we need standard equity and less structural customization at this level of capital.”
OpenAI needs more money right after the San Francisco-based software company announced in October that it would be getting $6.6 billion in funding, which would value the company at $157 billion.
ChatGPT is a famous AI chatbot made by OpenAI. More than 300 million people use it every week, and most of them do it for free.
People who follow the market say that OpenAI’s IPO in 2025 is unlikely because the company has been able to raise billions of dollars in private markets, including an investment from Microsoft Corp. MSFT -1.73%.
The California-based group said it wants to change its current for-profit business into a Delaware Public Benefit Corporation, or B-Corp. This is a type of business structure that is similar to those used by Patagonia and Seventh Generation, two companies that make products for the environment.
The organization of Ben & Jerry’s is the same as that of an operating unit in Unilever ULVR +0.31%.
The group OpenAI said Thursday that it will officially change its for-profit business into the PBC, which will work to help everyone.
OpenAI said that the non-profit’s big stake in the current for-profit would be represented by shares in the PBC at a fair value decided by outside financial advisors. “This will make the money our donors gave us many times bigger.”
The business said that a PBC is one that makes decisions while taking into account the needs of shareholders, stakeholders, and the general good.
The business will also keep its non-profit division as a charity for the health care, education, and science fields.
The company said, “The PBC will run and control OpenAI’s operations and business, while the non-profit will hire a leadership team and staff to work on charitable projects.”
The public benefit company is still a fairly new way to set up a business. Laureate Education (LAUR) -1.83% was the first PBC that the public could buy and sell.
