OpenAI Cancels Its For-Profit Plans

OpenAI just pulled off a dramatic pivot—and it could have profound implications for the future of artificial general intelligence (AGI), AI funding, and even global social systems.

In a move that seemed almost unthinkable just weeks ago, OpenAI announced it is abandoning plans to become a fully for-profit company. Instead, the organization says it will restructure its commercial arm as a public benefit corporation (PBC), while keeping its nonprofit entity in charge.

The change, driven by legal scrutiny, investor pressure, and broader societal concerns, shifts OpenAI’s trajectory—and possibly sets the stage for the creation of the most powerful nonprofit in human history.

On Episode 147 of The Artificial Intelligence Show, Marketing AI Institute founder and CEO Paul Roetzer broke down what’s really happening behind the scenes, and why this unexpected reversal might actually be OpenAI’s most ambitious move yet.

From For-Profit to Public Benefit

OpenAI’s original plan involved transitioning from its unique capped-profit model to a traditional for-profit company, uncapping investor returns in the process. But that vision ran into serious headwinds.

First, concerns emerged from the attorneys general of California and Delaware, states that oversee OpenAI’s nonprofit status. Then came civic and media backlash about the change to for-profit status (including a protest letter signed by AI insiders and Nobel laureates). And let’s not forget Elon Musk, who is still suing OpenAI for allegedly abandoning its nonprofit mission.

The new plan? Convert the for-profit subsidiary into a public benefit corporation. That means the company is still profit-driven, but legally obligated to consider broader social and environmental goals.

Roetzer calls it a pragmatic evolution, pointing to the fact that OpenAI clearly decided the path to a for-profit entity just wasn't worthwhile.

Importantly, this move isn’t a done deal yet. Microsoft, which has invested $13.75 billion into OpenAI, still needs to sign off. And final blessing from the attorneys general is also pending. But sources suggest SoftBank, which invested $30 billion contingent on a corporate restructuring, is already on board with the PBC model, says Roetzer.

How Public Benefit Corporations Actually Work

The term “public benefit corporation” gets thrown around often, but what does it really mean?

A PBC is a for-profit business, but one legally required to balance shareholder returns with a specific social mission. That means leadership is bound by fiduciary duty to consider the public good.

In practice, this mission is governed by internal oversight (like a board of directors), optional benefit committees, and legal documentation that outlines the company’s obligations. Accountability can vary, but the mission must remain core.

Altman insists the nonprofit board will continue to govern the new structure and hold equity in the PBC, allowing its resources to grow alongside OpenAI’s commercial success. In other words, as the company’s value rises, so too does the power of its nonprofit mission.

Why This Structure—and Why Now?

So why pivot now? According to CEO Sam Altman, the old structure made sense in a world with one dominant AGI lab. But not anymore. The current race to AGI includes serious contenders like Anthropic and xAI—both structured as public benefit corporations.

And Altman isn’t shy about the scale of the challenge ahead. He now says OpenAI may require “hundreds of billions and may eventually require trillions of dollars” to fulfill its mission. A more conventional capital structure, free of the 100x investor cap, clears the runway for massive new funding rounds, while the PBC (combined with nonprofit control) aims to satisfy critics who say a pure for-profit strays too far from OpenAI's mission.

Roetzer sees this shift as part legal necessity, part strategic acceleration.

"I think it'll just clear the pathway for them to accelerate what they're envisioning," he says. "And I think it'll accelerate the building of the nonprofit into maybe the most powerful nonprofit in the world."

The Real Play: A Trillion-Dollar Nonprofit?

If the restructure proceeds as planned, it could give rise to a nonprofit unlike anything the world has ever seen.

Roetzer believes this is not just about optics—it’s about preparing for a post-AGI world:

“They understand that what they’re going to build with AGI going to change society," he says. "The economic structure. The education system. Not just of America, but of the world.”

That kind of transformation requires more than better software. It demands massive financial and social infrastructure, something OpenAI’s nonprofit may now be tasked with creating.

Roetzer speculates that OpenAI could even use the nonprofit to implement programs like universal basic income (UBI), drawing on early UBI research they launched years ago. The vision? A self-funded, trillion-dollar nonprofit capable of redistributing wealth, supporting education, and safeguarding humanity’s future in an AI-driven world.

“I wouldn’t be shocked if they envision a world where that nonprofit was a trillion-dollar nonprofit that kicked off $X a year to provide income to people," he says.

A New Era for OpenAI—and for AI’s Role in Society

OpenAI’s latest pivot may seem like just another restructuring. But look closer, and it’s possibly pointing to something much bigger: A blueprint for how to align a world-altering technology with humanity’s best interests.

This is no longer just about who controls ChatGPT. It’s about designing a system (financial, legal, and ethical) that can keep up with the transformative power of AGI.

"That's why they're basically saying this nonprofit is going to be the most well-funded thing in human history, because what it needs to do is going to be massive," says Roetzer.

And if OpenAI can successfully pull it off, it won’t just change how AI companies are run. It could determine the course of AGI itself.