On Monday, OpenAI announced plans to become a publicly-listed company. OpenAI is the maker of ChatGPT, one of the world’s most widely-used AI chatbots.
If the company goes public, members of the public would be able to buy shares in OpenAI and own a small stake in the business.
The move comes after Anthropic and SpaceX announced they arealso going public.
So, what does this all actually mean?
What is OpenAI?
In 2015, OpenAI said it was being set up as a “non-profit artificialintelligence research company”aimed “to benefit humanity as awhole, unconstrained by a need to generate financial return”.
OpenAI began developing ChatGPT in 2018. Its first models were publicly released with detailed research in line with its originaltransparency pledge. In 2023, OpenAI launched its fourth generation model, but did not release its code publicly.
Over time, it converted to a for-profit entity.
Listing
When a business goes public, it invites people to purchase a ‘stake’ or ‘share’ in that company. A person who buys shares becomes a part-owner of that company, also known as an investor or a stakeholder.
An Initial Public Offering (IPO) is the first share price launched by a public company.
On Monday, OpenAI announced it had filed to the U.S. Securities and Exchange Commission (SEC) to become a public company.
In a post on OpenAI’s blog, they said: “We recently submitted a confidential S-1. We expect it to leak so we’re just announcing it.”
An S-1 is the first registration statement to the SEC.
A confidential file means that the public cannot view the listing information for a certain period of time.
At this stage, the number and cost of OpenAI’s future initial shares has not been made public.
Musk case
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Last month, X Corp founder andOpenAI co-founder Elon Musk unsuccessfully sued OpenAI CEO Sam Altman and President Greg Brockman, claiming they “stole a charity” by abandoning OpenAI's original non-profit mission.
Musk sought up to $US150 billion ($A209 billion) in damages, a court order forcing OpenAI back into a non-profit structure, and the removal of Altman and Brockman from their positions.
The jury unanimously found Musk had waited too long to sue, ruling the case fell outside the three-year statute of limitations.
Impact
So how could this affect ChatGPT users?
UNSW Associate Professor of Finance Mark Humphery-Jenner said impacts on consumers would likely be indirect.
He said a public listing would allow people to invest in OpenAI, while also exposing the company to greater scrutiny from shareholders if its products decline in quality.
Humphery-Jenner added that being publicly listed could also make it easier for OpenAI to acquire other companies and expand its offerings.
Other examples
In 2021, former OpenAI stafffounded Anthropic, the company behind AI chatbot Claude. Co-founder Dario Amodei later said he felt OpenAI was not sufficiently prioritising AI safety.
Last week, Anthropic also announced it had filed paperwork to go public.
Elsewhere, Elon Musk's SpaceX is preparing for its own stock market debut. Shares became available to Australian investors on 4 June ahead of the company's planned U.S. listing on 12 June. The IPO price has been set at US$135 (A$190) per share.
What’s next?
OpenAI has not set a timeline for when it might go public.
In a blog post, the company said it had "not decided on timing yet" and that "it may be a while" before any IPO proceeds.
OpenAI said remaining private offers some advantages, adding there are "things we want to do that are likely easier as a private company".
However, it said filing the paperwork gives it the option to move ahead more quickly if going public ultimately proves to be the best path.
