"OpenAI, the maker of ChatGPT, has completed a sweeping corporate overhaul that values the company at $500 billion, paving the way for it to become a fully fledged for-profit enterprise and one of the world's most valuable technology companies. The Silicon Valley group, founded as a non-profit research lab in 2015, has agreed a new structure with its long-time partner and investor Microsoft, allowing it to raise fresh capital while maintaining a non-profit parent body."
"The deal further binds OpenAI to Microsoft's vast Azure cloud computing network, with OpenAI agreeing to purchase $250 billion worth of Azure services over the next several years. However, Microsoft will lose its previous right of first refusal on OpenAI's future cloud contracts - a sign that the AI company is seeking greater flexibility as it expands. Microsoft shares rose 2 per cent to $542.07 following the announcement, giving the company a $4.046 trillion market value"
OpenAI completed a corporate restructuring that creates a for-profit arm valued at $500 billion while preserving a non-profit parent. The OpenAI Foundation will hold equity in the for-profit entity and Microsoft will retain a 27 percent stake, now valued at about $135 billion. The deal extends Microsoft’s access to OpenAI technology through 2032, including potential AGI scenarios. OpenAI agreed to purchase $250 billion of Azure services over upcoming years, while Microsoft relinquished its right of first refusal on future cloud contracts. Microsoft’s market value rose to about $4.046 trillion following the announcement.
Read at Business Matters
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