Here's a quick look: Who will own the new OpenAI

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How to obtain investment returns? The core question that has troubled OpenAI investors for years is about to be answered.

On September 17, according to tech media outlet The Information, OpenAI is fundamentally changing its equity structure through a company 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 restructuring plan, Microsoft, as the largest external backer, will receive about 28% of the shares, worth around $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 two state attorneys general. Once approved, new investors such as Thrive Capital and SoftBank will no longer be constrained by the current return cap structure and will be able to obtain equity returns matching their substantial investments.

After the restructuring, investors in a new $41 billion funding round led by SoftBank will collectively hold about 13% of the shares, worth about $65 billion. Institutions participating in this round include Founders Fund, Sequoia Capital, Andreessen Horowitz, and Dragoneer Investment Group.

Microsoft Obtains the Largest Stake

As OpenAI's most important strategic partner, Microsoft will hold about 28% of the shares after the restructuring, making it the largest single external shareholder.

This shareholding percentage is equivalent to a paper value of around $140 billion at a $500 billion valuation, far exceeding its rights under the current limited return structure.

However, according to earlier reports, Microsoft's requirements for OpenAI go beyond just equity.

The company is also seeking guaranteed usage rights for OpenAI's intellectual property beyond 2030. The finalization of these additional terms may affect the exact proportion of equity distribution.

Employees and Nonprofit Organization Receive Significant Position

In the new equity structure, OpenAI's current and former employees will collectively receive about 25% of the shares, valued at about $125 billion based on a $500 billion valuation.

This arrangement reflects recognition of talent value, especially against the backdrop of intense competition for key talent in the AI field.

The nonprofit board managing OpenAI is expected to receive about 27% of the shares, worth around $135 billion.

Under the current structure, the nonprofit organization has the right to receive all remaining profits generated by the for-profit division after nearly $275 billion in profits have been distributed to other shareholders.

Early Investors Gain Considerable Returns

The earliest investors in OpenAI's for-profit division, 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 people familiar with the matter, this portion of the shares may amount to about 1% of the company after restructuring, worth about $5 billion.

These investors invested a total of $194 million in the division in 2019. Although the shareholding percentage is relatively small, considering the investment amount and timing, this still represents a considerable investment return.

New Shareholders Gain Unexpected Returns Through Acquisition

Some of OpenAI’s newest shareholders will also possess significant portions. Earlier this year, OpenAI acquired hardware startup Io, founded by former Apple designer Jony Ive, for $5 billion in stock.

According to documents viewed by The Information, Io’s shareholders will own about 1.6% of OpenAI after the restructuring.

At a $500 billion valuation, this means that investors including Thrive Capital, Emerson Collective, and SV Angel collectively own OpenAI shares worth $7.75 billion.

For investors in a startup that has been in existence for only one year, this represents a rather impressive paper return.

Risk Notification and DisclaimerThe market is risky, and investment should be cautious. This article does not constitute personal investment advice, nor does it take into account the specific investment objectives, financial situations, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific situation. Investing based on this information is at your own risk. ```