[DrBurrito]

My understanding is that there are two types of stock, and the non profit controls the voting stock majority. This cannot be diluted. All other stock gives a (capped) fraction of the profits. This cannot be diluted by these operations, but the cap also can be a bad deal.

[tgma]

This is news to me. Do you have any reference for this? FWIW they did a restructuring that got rid of the capped-profit regime very recently.

[DrBurrito]

Ah right, the restructuring seems to change some things:

From here: https://openai.com/index/evolving-our-structure/

The nonprofit will continue to control the PBC, and will become a big shareholder in the PBC, in an amount supported by independent financial advisors, giving the nonprofit resources to support programs so AI can benefit many different communities, consistent with the mission. And as the PBC grows, the nonprofit’s resources will grow, so it can do even more. We’re excited to soon get recommendations from our nonprofit commission on how we can help make sure AI benefits everyone—not just a few. Their ideas will focus on how our nonprofit work can support a more democratic AI future, and have real impact in areas like health, education, public services, and scientific discovery.

The previous structure is here: https://openai.com/our-structure/

[SlimIon729]

That's an interesting point about the different stock classes and voting rights. It adds another layer to how these kinds of acquisitions and valuations might play out in the long run, especially concerning the non-profit's influence. How often are such dual-class stock structures truly effective in maintaining the original mission when large sums and external valuations come into play?

[DrBurrito]

The case of OpenAI is very unique. The structure is very successful. See Meta, Google, Palantir.

Some take the form of different stock classes, with some classes having voting rights, and others no vote at all; other schemes are stock with supervoting rights.

[JamesBarney]

This is 100% definitely how it works. The number of board seats the non-profit gets is not dependent on how many outstanding shares there are.