I’ve written about OpenAI’s work several times before
, including a couple of weeks ago
, when they announced a new AI language model. This week they announced a number of developments, including co-founder Sam Altman stepping down
as Y Combinator’s President to become OpenAI’s CEO.
Most interestingly, though, was a new organisational form
- a “capped profit” company - that OpenAI has developed to let it maintain not-for-profit status while raising massive amounts of funding. Private, profit seeking investors can invest in a limited partnership
where the general partner (GP) is OpenAI’s not-for-profit entity. Crucially, the GP’s primary fiduciary duty will be to advance OpenAI’s mission
, as embodied in its charter
, rather than to return cash to investors. Any financial return will be capped at 100x the amount invested (which is hardly modest…)
This is interesting in its own right, in that it opens up the capital to put OpenAI on a much more even playing field with Google’s DeepMind
(I’m intrigued by the line at the end of OpenAI’s announcement
that says “we are willing to merge with a value-aligned organization… to avoid a competitive race which would make it hard to prioritize safety”). But it’s also interesting to think about where else a “capped profit” company might be a useful mechanism. Battling climate change? Fighting certain diseases? I’d be excited to see more of them.