A visual guide: Who will own the new OpenAI
According to reports, in OpenAI's restructuring plan with a valuation of $500 billion, Microsoft, as the largest external shareholder, holds about 28% of the shares (worth $140 billion); the nonprofit board holds about 27% of the shares (worth $135 billion); current and former employees collectively hold about 25% of the shares (worth $125 billion); investors in the new financing round led by SoftBank hold about 13% of the shares (worth $65 billion); early investors receive about 1% of the shares (worth $5 billion)
How to achieve investment returns? The core question that has troubled OpenAI investors for years is about to be resolved.
On September 17, according to technology media The Information, OpenAI is fundamentally changing its equity structure through a corporate restructuring, shifting from a non-profit limited return model to a traditional corporate equity system.
According to The Information's analysis of data shared by OpenAI with potential investors, in this $500 billion valuation restructuring plan, Microsoft, as the largest external supporter, will acquire approximately 28% of the shares, worth about $140 billion. Current and former employees will collectively hold about 25% of the shares, valued at approximately $125 billion.
The restructuring plan still requires approval from Microsoft and the attorneys general of two states. Once approved, new investors, including Thrive Capital and SoftBank, will no longer be constrained by the current return cap structure and will be able to obtain equity returns commensurate with their substantial investments.
After the restructuring, investors in the $41 billion new financing round led by SoftBank will collectively hold about 13% of the shares, valued at approximately $65 billion. Institutions participating in this financing round include Founders Fund, Sequoia Capital, Andreessen Horowitz, and Dragoneer Investment Group.
Microsoft acquires the largest share
As OpenAI's most important strategic partner, Microsoft will hold approximately 28% of the shares after the restructuring, making it the largest single external shareholder.
This shareholding ratio corresponds to a paper value of about $140 billion at a $500 billion valuation, far exceeding its equity under the current limited return structure.
However, according to previous reports, Microsoft's demands from OpenAI go beyond just equity.
The company is also seeking guaranteed usage rights to OpenAI's intellectual property after 2030. The finalization of these additional terms may affect the specific distribution of equity.
Employees and non-profit organization gain significant status
In the new equity structure, current and former OpenAI employees will collectively receive about 25% of the shares, valued at approximately $125 billion based on a $500 billion valuation.
This arrangement reflects recognition of the value of talent, especially in the context of fierce competition for key talent in the AI field.
The non-profit board managing OpenAI is expected to receive about 27% of the shares, valued at approximately $135 billion.
Under the current structure, this non-profit organization has the right to receive all remaining profits generated by the profit-making department after other shareholders share nearly $275 billion in profits.
Early investors enjoy substantial returns
The earliest investors in OpenAI's profit-making department, including Khosla Ventures, the University of Michigan, the Reid Hoffman Foundation, Gmail founder Paul Buchheit, and Y Combinator, will collectively receive a low single-digit percentage of equity According to informed sources, this portion of equity may account for nearly 1% of the company after restructuring, valued at approximately $5 billion.
These investors collectively invested $194 million in the department in 2019. Although the shareholding ratio is relatively small, considering the investment amount and time, it still represents a considerable return on investment.
New shareholders gain unexpected profits through acquisition
Some of the latest OpenAI shareholders will also hold significant stakes. Earlier this year, OpenAI acquired the mysterious hardware startup Io, founded by former Apple designer Jony Ive, for $5 billion in stock.
According to documents reviewed by The Information, shareholders of Io will own about 1.6% of OpenAI after the restructuring.
Based on a $500 billion valuation, this means that investors including Thrive Capital, Emerson Collective, and SV Angel collectively own OpenAI shares worth $7.75 billion.
This is quite a decent paper return for investors in a startup that has only been established for a year
