OpenAI in talks with Microsoft for future IPO
It has been reported that Microsoft, which has invested heavily in OpenAI, is in negotiations with OpenAI to discuss how much profit Microsoft could make if OpenAI were to hold an initial public offering (IPO).
OpenAI negotiates with Microsoft to unlock new funding and future IPO
OpenAI negotiating with Microsoft for new billion-dollar deal to clear path for future IPO: Report - OpenAI negotiating with Microsoft for new billion dollar deal to clear path for future IPO: Report BusinessToday
https://www.businesstoday.in/technology/news/story/openai-negotiating-with-microsoft-for-new-billion-dollar-deal-to-clear-path-for-future-ipo-report-475851-2025-05-12
OpenAI aims to develop general-purpose artificial intelligence that is safe and benefits all of humanity without being hindered by profit incentives, and is run by a for-profit corporation under the management of a non-profit corporation.
However, this system places a cap on financial returns to investors and employees, so OpenAI CEO Sam Altman was not happy with this and planned to create a public benefit company (PBC) to attract further investment and transfer jurisdiction from the non-profit corporation. However, there was opposition to this plan, which was said to undermine OpenAI's public interest, and CEO Altman eventually withdrew part of the plan.
OpenAI decides to abandon commercialization and continue to be managed by a non-profit organization - GIGAZINE
The plan to transfer jurisdiction was abandoned, but it was announced that a new PBC would be created and existing for-profit corporations would be transferred to the new PBC. The PBC would continue to be managed by a non-profit corporation, but in theory it could be IPO'd, and according to the Financial Times, Microsoft and OpenAI are already in talks with an eye on an IPO.
Microsoft has reportedly invested more than $13 billion in OpenAI to date, and according to the Financial Times, a key point in the talks is how much of OpenAI's stock Microsoft will get in exchange for that investment.
According to a person familiar with the negotiations, OpenAI and Microsoft are also looking to revise the terms of their first partnership, which includes providing Microsoft with access to cutting-edge artificial intelligence models and sharing revenue from product sales, and is originally set to continue until 2030. Microsoft has proposed reducing its shareholding in OpenAI if it can continue to have access to any next-generation technologies developed by the company after the deadline, the Financial Times reported.
Microsoft is incorporating OpenAI's technology into its software products, and in exchange, it is providing OpenAI with massive computing power for training AI models. However, OpenAI has recruited partners such as SoftBank and Oracle to build its own large-scale computing infrastructure called 'Stargate,' so some believe that it will eventually leave Microsoft and the competition between the two companies will intensify. The Financial Times pointed out that 'the deal between the two companies is crucial to OpenAI's restructuring and could determine the future of OpenAI, which has been at the forefront of AI.'
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