OpenAI's Obscene Profit Shift Betrays Nonprofit Roots
OpenAI was established in 2015 as a nonprofit research institute with an ambitious, altruistic goal: to develop “artificial general intelligence” (AGI) that would benefit all of humanity. Its founders, including current CEO Sam Altman and co-founder Elon Musk, articulated a vision for a company “unconstrained by a need to generate financial return,” asserting that freedom from financial obligations would allow it to focus purely on positive human impact.
Less than a decade later, the creator of ChatGPT presents a starkly different profile. The company has ridden a colossal wave of AI hype, embracing precisely the financial incentives it once sought to avoid. Reports indicate OpenAI is currently engaged in discussions for a potential secondary stock sale that could value it at approximately half a trillion dollars, a staggering five-fold increase in just two years. This follows a recent funding deal that already pegged its valuation at an immense $300 billion.
Sam Altman has spearheaded significant structural transformations, effectively dismantling the company’s original nonprofit framework. In 2019, OpenAI introduced a “capped-profit” subsidiary, ostensibly to attract essential funding while claiming its nonprofit parent would retain control and channel excess investor funds back into its core mission. However, the pursuit of financial gain intensified. Last year, the company further distanced itself from its nonprofit origins by restructuring its primary business into a for-profit benefit corporation. While a spokesperson affirmed to Reuters at the time that the nonprofit remained “core to our mission,” and a May blog post reiterated that the original nonprofit governing board would maintain control even as it became a “Public Benefit Corporation” (PBC) — a structure intended to balance shareholder interests with its mission — the actions signal a clear shift.
Critics question whether OpenAI truly remains committed to building a benevolent, superhuman AI that serves everyone equally, or if it has become an entity prioritizing profits above all else. The very concept of “superhuman AI” remains ill-defined, and the company’s claims of universal benefit have been challenged, particularly after it quietly removed a ban on “military and warfare” applications from its usage policies in early 2024. Elon Musk, who departed OpenAI in 2019 due to disagreements over its trajectory, has repeatedly accused the company of bending over backwards to “maximize profits for Microsoft, rather than for the benefit of humanity,” even going so far as to sue the firm multiple times. This criticism persists despite Musk having launched his own profit-driven AI venture, xAI.
Indeed, OpenAI has drifted dramatically from its initial pledge to be “unconstrained by a need to generate financial return.” This profit-maximizing entity has capitalized immensely on investors eager to automate jobs, reduce costs, and ride an unprecedented wave of technological enthusiasm. Experts have voiced concerns that the burgeoning AI industry is forming an immense economic bubble, potentially surpassing the steep overvaluation seen in tech companies during the dot-com crisis more than two decades ago. The intense hype has propelled nine publicly traded companies past the $1 trillion valuation mark in a matter of years, fueling anxieties that a potential bubble collapse could have broader economic repercussions. For now, however, OpenAI continues to cash in, having announced a $40 billion funding round just months ago—reportedly the largest amount ever raised by a private company.