OpenAI, a leading machine-learning lab, has launched for-profit spin-off OpenAI LP – so it can put investors’ cash toward the expensive task of building artificial general intelligence.
The San-Francisco-headquartered organisation was founded in late 2015 as a nonprofit, with a mission to build, and encourage the development of, advanced neural network systems that are safe and beneficial to humanity.
It was backed by notable figures including killer-AI-fearing Elon Musk, who has since left the board, and Sam Altman, the former president of Silicon Valley VC firm Y Combinator. Altman stepped down from as YC president last week to focus more on OpenAI.
Altman is now CEO of OpenAI LP. Greg Brockman, co-founder and CTO, and Ilya Sutskever, co-founder and chief scientist, are also heading over to the commercial side and keeping their roles in the new organization. OpenAI LP stated it clearly it wants to “raise investment capital and attract employees with startup-like equity.”
There is still a nonprofit wing, imaginatively named OpenAI Nonprofit, though it is a much smaller entity considering most of its hundred or so employees have switched over to the commercial side, OpenAI LP, to reap the benefits its stock options.
“We’ve experienced firsthand that the most dramatic AI systems use the most computational power in addition to algorithmic innovations, and decided to scale much faster than we’d planned when starting OpenAI,” the lab’s management said in a statement this week. “We’ll need to invest billions of dollars in upcoming years into large-scale cloud compute, attracting and retaining talented people, and building AI supercomputers.”
OpenAI refers to this odd split between OpenAI LP and OpenAI Nonprofit as a “capped-profit” company. The initial round of investors, including LinkedIn cofounder Reid Hoffman and Khosla Ventures, are in line to receive 100 times the amount they’ve invested from OpenAI LP’s profits, if everything goes to plan. Any excess funds afterwards will be handed over to the non-profit side. In order to pay back these early investors, and then some, OpenAI LP will have to therefore find ways to generate fat profits from its technologies.
The reaction to the “capped-profit” model has raised eyebrows. Several machine-learning experts told The Register they were somewhat disappointed by OpenAI’s decision. It once stood out among other AI orgs for its nonprofit status, its focus on developing machine-learning know-how independent of profit and product incentives, and its dedication to open-source research.
Now, for some, it appears to be just another profit-driven Silicon Valley startup stocked with well-paid engineers and boffins.