After months of internal debate, public scrutiny, and a lawsuit from Elon Musk, OpenAI has chosen a hybrid structure that keeps its nonprofit parent in charge while inviting investments into its for-profit arm, Reuters reported.

A Structure Born of Compromise

Rather than fully converting into a traditional for-profit company, OpenAI said it will transform its for-profit subsidiary into a public benefit corporation.

The company expects this structure to allow it to pursue large-scale investments, such as a potential $40 billion funding round led by SoftBank while keeping ultimate control in the hands of its nonprofit overseers.

The goal: maintain focus on the public good while accessing the capital needed to remain competitive in the race toward artificial general intelligence. OpenAI’s board chair Bret Taylor called the new structure “extremely close” to the existing one.

The structural overhaul may not defuse all of OpenAI’s challenges. Elon Musk, who co-founded the organization and now runs rival firm xAI, has sued OpenAI, accusing it of betraying its original mission. His lawsuit, which targets the shift toward a profit-oriented model, remains active and is scheduled for trial in 2026.

Tensions With Musk and a Looming Trial

Adding more intrigue, Musk reportedly led a consortium that offered $97.4 billion to acquire OpenAI earlier this year, a bid rejected outright by Altman.

OpenAI’s shift to a public benefit corporation is designed to balance shareholder returns with long-term public impact. Unlike traditional corporations that focus solely on profit, benefit corporations have a legal obligation to consider social goals. Still, critics question how the nonprofit will manage asset allocation and ensure that commercial objectives don’t dilute the mission.

Microsoft, a major backer of OpenAI, declined to comment on the restructuring. However, the tech giant’s continued support is widely seen as crucial to OpenAI’s future. SoftBank, which reportedly leads the massive $40 billion fundraising push, has yet to respond publicly, but Altman indicated the new setup should not disrupt those talks.

With capital needs rising and competition intensifying, OpenAI’s leadership has crafted a compromise. Whether this structure can hold under the pressure of rapid AI development and growing external scrutiny remains to be seen.

Source: Finance Magnates