“The End of OpenAI’s Nonprofit Era” by garrison

Key regulators have agreed to let the company kill its profit caps and restructure as a for-profit — with some strings attached

This is the full text of a post first published on Obsolete, a Substack that I write about the intersection of capitalism, geopolitics, and artificial intelligence. I’m a freelance journalist and the author of a forthcoming book called Obsolete: Power, Profit, and the Race to Build Machine Superintelligence. Consider subscribing to stay up to date with my work.

This morning, the Delaware and California attorneys general conditionally signed off on OpenAI's plan to restructure as a for-profit public benefit corporation (PBC), seemingly closing the book on a fiercely contested legal fight over the company's future.

Microsoft, OpenAI's earliest investor and another party with power to block the restructuring, also said today it would sign off in exchange for changes to its partnership terms and a $135 billion stake in the new PBC.

With these stakeholders mollified, OpenAI has now cleared its biggest obstacles to a potential IPO — aside from its projected $115 billion cash burn through 2029.

While the news initially seemed like a total defeat for the many opponents of the restructuring effort, the details [...]

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Outline:

(00:10) Key regulators have agreed to let the company kill its profit caps and restructure as a for-profit -- with some strings attached

(02:05) The governance wins

(08:14) No more profit caps

(11:52) Testing my prediction

(13:20) A political, not a legal, question

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First published:
October 29th, 2025

Source:
https://www.lesswrong.com/posts/GNFb8immoCDvDtTwk/the-end-of-openai-s-nonprofit-era

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Narrated by TYPE III AUDIO.