Your Needs Our Focus
Financial Bulletin
One picture to understand: Who will own the New OpenAI
How to obtain investment returns? The core issue that has plagued OpenAI investors for many years is about to be resolved.
On September 17th, according to The technology media The Information, OpenAI is completely changing its equity structure through corporate restructuring, shifting from a non-profit limited return model to a traditional corporate equity system.
According to The Information's data analysis of OpenAI's sharing with potential investors, in this restructuring plan valued at 500 billion US dollars, Microsoft, as the largest external supporter, will acquire approximately 28% of the shares, worth about 140 billion US dollars. Current and former employees will collectively hold approximately 25% of the shares, worth about 125 billion US dollars.
The restructuring plan still needs to be approved by 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 that match their huge investments.
After the reorganization, the investors in the new $41 billion financing round led by SoftBank will jointly hold approximately 13% of the shares, worth about $65 billion. The institutions participating in this round of financing include Founders Fund, Sequoia Capital, Andreessen Horowitz and Dragoneer Investment Group.
Microsoft acquired the largest stake
As OpenAI's most important strategic partner, Microsoft will hold approximately 28% of the shares after the reorganization, making it the largest single external shareholder.
This shareholding ratio is equivalent to having a paper value of approximately $140 billion at a valuation of $500 billion, which is much higher than its equity under the current restricted return structure.
However, as previously reported, Microsoft's demands on OpenAI are not merely about equity.
The company is also seeking to obtain guaranteed usage rights of OpenAI's intellectual property rights after 2030. The finalization of these additional terms may affect the specific proportion of equity distribution.
Employees and non-profit organizations have gained an important position
In the new equity structure, current and former employees of OpenAI will collectively acquire approximately 25% of the shares, which is valued at around $125 billion based on a valuation of $500 billion.
This arrangement reflects the recognition of the value of talents, especially against the backdrop of fierce competition for key talents in the AI field.
The non-profit board that manages OpenAI is expected to acquire approximately 27% of the shares, worth about 135 billion US dollars.
Under the current structure, the non-profit organization is entitled to all the remaining profits generated by the profit-making sector after other shareholders have received nearly 275 billion US dollars in profits.
Early investors can enjoy considerable returns
The earliest investors in OpenAI's profit-making division, including Khosla Ventures, the University of Michigan, the Reid Hoffman Foundation, Paul Buchheit, the founder of Gmail, and Y Combinator, will jointly acquire a low-digit equity stake.
According to informed sources, this portion of equity may approach 1% of the restructured company's share, valued at approximately 5 billion US dollars.
These investors injected a total of 194 million US dollars into the department in 2019. Although the shareholding ratio is relatively small, considering the investment amount and time, this still represents a considerable investment return.
The new shareholders gained unexpected profits through the acquisition
Some of the latest OpenAI shareholders will also have significant shares. Earlier this year, OpenAI acquired Io, a mysterious hardware startup founded by former Apple designer Jony Ive, for $5 billion in stocks.
According to documents reviewed by The Information, shareholders of Io will own approximately 1.6% of the shares of the restructured OpenAI.
Based on a valuation of $500 billion, this means that investors including Thrive Capital, Emerson Collective and SV Angel collectively own OpenAI shares worth $7.75 billion.
For investors in a start-up company that has only been established for one year, this is a rather good paper return.
Risk Warning and Disclaimer
The market involves risks. Please invest with caution. This article does not constitute personal investment advice and has not taken into account the individual user's specific investment objectives, financial situation or needs. Users should consider whether any opinions, views or conclusions in this article are suitable for their specific circumstances. Any investment made based on this is at your own risk.