OpenAI to remain under nonprofit control

Elon Musk previously sued the organization over a proposed restructuring.

By Emma Keates | May 5, 2025 | 4:43pm

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OpenAI to remain under nonprofit control

Elon Musk just scored some points in his ongoing lawsuit-off with OpenAI. Today, the Sam Altman-led organization announced that it was reversing course on a proposed restructuring that would have reconfigured it into a for-profit company. OpenAI was initially founded in 2015 as a nonprofit with the aim of developing “safe and beneficial” AI tools to “benefit all of humanity.” The company’s new plan will see it restructured as a public benefit corporation—a type of organization “designed to create public and social good and allow outsiders to invest in much the same way they invest in other companies,” per The New York Times—with the nonprofit arm retaining a controlling stake.

OpenAI’s proposed restructuring has caused a good deal of trouble in tech-billionaire paradise. Elon Musk, an early OpenAI investor, sued the company for breach of contract last year, alleging that the transition to a for-profit company would betray the ChatGPT owner’s founding principles. (It feels like the best way for OpenAI to actually benefit humanity would be to stop guzzling up the world’s water supply, but we digress.)

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Musk, who just happens to be an AI company CEO himself, then offered $97.4 billion to buy OpenAI, a proposal Altman rejected with his own bid to buy Twitter (now X) for “$9.74 billion if you want.” Because these grown billionaires can’t just play a round of laser tag or something to settle the score, OpenAI then countersued Musk last month, alleging that the company “recognized [Musk’s] bid as a feint,” but was forced to divert resources and “suffered harm as a result of Musk’s unlawful campaign of harassment, interference, and misinformation.”

Regardless of how much this ongoing dispute factored into OpenAI’s choice, Altman is reportedly “very happy we made the decision for the nonprofit to maintain control.” The new direction “sets us up to have a more understandable structure to do the things that a company like our [sic] has to do,” he continued in a press briefing, per NYT. The company is still negotiating the nonprofit’s stake in the new corporation, but it will reportedly be in charge of putting together the company’s new board. We’ll see how this techie conclave fares in the coming months.