Elon Musk, investors offer $97B to buy OpenAI’s nonprofit division

Photo : Reuters

Elon Musk and a group of investors have offered $97.4 billion to buy the nonprofit part of OpenAI. This has increased the fight between Musk and Sam Altman, the CEO of OpenAI. Musk’s lawyer, Marc Toberoff, sent the offer. If Musk is successful, this could change the future of OpenAI and stop Altman’s plan to turn the company into a for-profit business.

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Musk helped start OpenAI in 2015 but left in 2018 because he did not agree with the way it was moving. Since then, he has often said that OpenAI is not following its original goal. OpenAI was made to help people by creating safe AI, but Musk believes it is now focused on making money. Microsoft has invested a lot of money in OpenAI, and Musk thinks OpenAI is now too close to Microsoft.

After making his offer, Musk said, "It is time for OpenAI to go back to helping people and sharing its work. We will make sure that happens." Sam Altman, the CEO of OpenAI, replied with a joke on X (formerly Twitter). He said, "No thank you, but we will buy Twitter for $9.74 billion if you want." He moved the decimal point in Musk’s offer to make fun of it.

OpenAI was first created as a nonprofit so that AI technology could be shared with everyone. But in 2019, it changed its structure to allow big companies like Microsoft to invest money. Right now, Altman wants to separate the nonprofit part of OpenAI but still keep a stake in the new company. Musk’s offer has raised questions about how much the nonprofit part of OpenAI is worth. If Musk wins, he and his investors could control this important part of OpenAI.

Musk is not alone in this plan. His AI company, xAI, is leading the offer with help from big investors like Valor Equity Partners, Baron Capital, Atreides Management, Vy Capital, and 8VC. Hollywood businessman Ari Emanuel is also part of this deal. If Musk is successful, he may combine OpenAI with xAI, creating a very powerful AI company.

Musk has already taken legal action against OpenAI. He says OpenAI broke its promise by working too closely with Microsoft. He also asked government officials in California and Delaware to check how OpenAI is being valued. OpenAI has denied Musk’s claims and said it is being fair in its business changes.

At the same time, OpenAI is talking with Microsoft and other investors about how its business will grow. Japanese tech company SoftBank is also thinking about investing $25 billion in OpenAI. If that happens, OpenAI’s total value could reach $300 billion. This means OpenAI has to make a big decision—accept Musk’s offer or move forward with SoftBank and Microsoft.

Musk’s offer has put OpenAI’s leaders in a tough spot. If they accept his offer, OpenAI’s nonprofit work could return to its original mission of helping people. If they reject Musk, OpenAI will continue as a for-profit company with support from big investors. This decision will shape the future of AI and change who controls AI technology in the world.