OpenAI is closing in on raising $6.5 billion. But in order to do so it looks like it will need to do the Delaware equivalent of selling its soul—it will have to overhaul its governance structure so that it’s no longer controlled by a nonprofit. Professor Linda Sugin, whose scholarly interests focus on issues of distributive justice in taxation and the governance of nonprofit organizations, was quoted in an Axios article discussing why Axios’ shift toward for-profit structuring matters.
Zoom out: OpenAI was founded by a group of researchers who feared Silicon Valley would race to build super-powerful AI without making sure it was safe first. Critics of the company’s evolution argue that, under Sam Altman, OpenAI flipped that script once it found that it could lead the race.
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“If what’s happening is that this reorganization allows AI to destroy the world, then that’s simply inconsistent with the purposes of the original organization,” Fordham law professor Linda Sugin tells Axios.
Read “OpenAI’s corporate soul at risk” in Axios.