OpenAI
In December 2015, OpenAI emerged as a not-for-profit organization in Delaware. Sam Altman and Elon Musk served as co-chairs alongside Ilya Sutskever, Greg Brockman, Trevor Blackwell, Vicki Cheung, Andrej Karpathy, Durk Kingma, John Schulman, Pamela Vagata, and Wojciech Zaremba. The group pledged $1 billion in capital from investors including Reid Hoffman, Peter Thiel, Amazon Web Services, and Infosys. Actual funds received lagged significantly behind these pledges. Company disclosures showed only $130 million had been collected by 2019.
The founding charter stated an intention to collaborate openly with other institutions by making certain patents and research publicly available. This stance later shifted due to competitive and safety concerns. The startup initially operated from Greg Brockman's living room before moving to the Pioneer Building in San Francisco's Mission District. Their mission was to ensure artificial general intelligence benefits all of humanity rather than private gain.
Musk and Altman expressed concern about AI safety and existential risk from highly autonomous systems that outperform humans at economically valuable work. They believed human-level AI could benefit society but also cause immense damage if built incorrectly. The founders argued AI should be an extension of individual human wills distributed broadly and evenly. They anticipated a decades-long project surpassing human intelligence.
Greg Brockman recruited nine researchers as the first employees in December 2015. OpenAI did not offer salaries comparable to Facebook or Google, nor stock options typical for such roles. Nevertheless, the company spent $7 million on its first 52 employees in 2016. A Google employee left his job to join OpenAI partly because of the strong group of people and the organization's mission. Wojciech Zaremba turned down offers worth two to three times his market value to join instead.
In 2019, OpenAI transitioned from non-profit status to become a capped-for-profit entity. This model allowed profit to be capped at 100 times any investment. The move enabled OpenAI Global LLC to legally attract venture fund investment while granting employees stakes in the company. Many top researchers worked for competitors like Google Brain or DeepMind which offered equity that a nonprofit could not match. Before this transition, OpenAI was legally required to publicly disclose compensation for its top employees.
The company distributed equity to employees and partnered with Microsoft through a $1 billion investment package. Since then, OpenAI systems have run on an Azure-based supercomputing platform provided by Microsoft. OpenAI Global LLC announced intentions to commercially license technologies within five years, possibly much faster. Altman stated even a billion dollars might prove insufficient to achieve artificial general intelligence.
OpenAI Inc remained the sole controlling shareholder of OpenAI Global LLC despite its for-profit status. A majority of OpenAI Inc board members were barred from holding financial stakes in OpenAI Global LLC. Minority members with stakes faced voting restrictions due to conflict of interest concerns. Some researchers argued the switch to for-profit status contradicted claims about democratizing AI.
Elon Musk filed a lawsuit against OpenAI and Sam Altman on the 29th of February 2024. He accused them of shifting focus from public benefit to profit maximization. OpenAI dismissed the case as incoherent and frivolous before Musk revived legal action in August. On the 9th of April 2024, OpenAI countersued Musk alleging bad-faith tactics to slow progress and seize innovations for personal benefit.
A consortium led by Elon Musk submitted a $97.4 billion unsolicited bid to buy the nonprofit controlling OpenAI on the 10th of February 2025. The offer was rejected on the 14th of February 2025, stating the company was not for sale. This complicated Altman's restructuring plan by suggesting a lower valuation bar for the nonprofit. In December 2024, OpenAI proposed converting the capped-profit entity into a Delaware-based public benefit corporation released from nonprofit control.
On the 28th of October 2025, OpenAI adopted the new Public Benefit Corporation structure after receiving approval from California and Delaware attorneys general. The for-profit branch became OpenAI Group PBC while the non-profit renamed itself the OpenAI Foundation. The Foundation holds a 26% stake in the PBC while Microsoft owns 27%. Employees and other investors hold the remaining 47%. All board members of the PBC are appointed by the Foundation which can remove them at any time.
In February 2019, OpenAI announced GPT-2 gaining attention for its ability to generate human-like text. Eleven employees left between December 2020 and January 2021 to establish Anthropic. In 2020, the organization introduced GPT-3 trained on large internet datasets. It aimed at natural language answering questions but could also translate languages and coherently generate improvised text. An associated API named simply API formed the heart of their first commercial product.
OpenAI introduced DALL-E in 2021 as a specialized deep learning model adept at generating complex digital images from textual descriptions. By January 2023, ChatGPT had become the fastest-growing consumer software application in history gaining over 100 million users in two months. A free preview launched in December 2022 received over one million signups within five days according to company data.
Microsoft announced building AI technology based on ChatGPT's foundation into Bing, Edge, and Microsoft 365 products on the 7th of February 2023. On the 14th of March 2023, OpenAI released GPT-4 both as an API with waitlist access and as a feature of ChatGPT Plus. New sign-ups for ChatGPT Plus were temporarily suspended on the 14th of November 2023 due to high demand before reopening a month later.
In December 2024, the company launched Sora, a text-to-video model alongside OpenAI o1 reasoning models codenamed strawberry. ChatGPT Pro became available as a $200 monthly subscription offering unlimited o1 access and enhanced voice features. Preliminary benchmark results for upcoming OpenAI o3 models were shared during this period.
On the 23rd of January 2025, OpenAI released Operator, an AI agent and web automation tool accessible only to Pro users in the United States. Deep research agents followed nine days later scoring 27% accuracy on Humanity's Last Exam benchmarks. Altman stated GPT-4.5 would be the last model without full chain-of-thought reasoning capabilities.
Reports from July 2025 indicated AI models by OpenAI solved mathematics problems at top-performing student levels in International Mathematical Olympiads. Gold medal-level performance reflected significant progress in reasoning abilities. On the 6th of October 2025, the company unveiled Agent Builder platform allowing developers to design workflows with limited coding through visual drag-and-drop interfaces.
ChatGPT Atlas arrived on the 21st of October 2025 integrating the assistant directly into web navigation to compete with Chrome and Safari. GPT-5.2 was announced the 11th of December 2025 improving spreadsheet creation, presentation building, image perception, code writing, and long context understanding. Prism launched the 27th of January 2026 as a LaTeX-native workspace assisting scientists with drafting papers including citation management and equation formatting.
In 2017, OpenAI spent $7.9 million on cloud computing alone representing a quarter of functional expenses. DeepMind's total expenses that year reached $442 million. Training Dota 2 bots required renting 128,000 CPUs and 256 GPUs from Google for multiple weeks during summer 2018. In October 2024, OpenAI completed a $6.6 billion capital raise achieving a $157 billion valuation including investments from Microsoft, Nvidia, and SoftBank.
Donald Trump announced The Stargate Project on the 21st of January 2025 as a joint venture between OpenAI, Oracle, SoftBank, and MGX. The project aimed to build AI infrastructure costing an estimated $500 billion over four years. Partners planned funding through the next four years. The U.S. Department of Defense awarded OpenAI a $200 million contract in July for military AI applications alongside Anthropic, Google, and xAI.
OpenAI made a deal with the UK Government in July 2025 to use ChatGPT and other tools in public services. A $50 million fund supported nonprofit and community organizations. April 2025 saw OpenAI raise $40 billion at a $300 billion post-money valuation marking history's highest-value private technology deal led by SoftBank.
July 2025 reports indicated annualized revenue reached $12 billion increasing from $3.7 billion in 2024 driven by ChatGPT subscriptions reaching 20 million paid subscribers by April 2025. Enterprise customers grew to five million business users. Cash burn remained high due to intensive computational costs required to train large language models.
The company projected an $8 billion operating loss in 2025 while revising long-term spending projections totaling approximately $115 billion through 2029. Annual expenditures were expected to escalate significantly reaching $17 billion in 2026, $35 billion in 2027, and $45 billion in 2028. More than half of spending through the decade would support research-intensive compute for model training.
Targeting cash-flow-positive operations by 2029, OpenAI projected revenue of approximately $200 billion by 2030. This aggressive trajectory underscored enormous capital requirements for scaling cutting-edge AI technology. In October 2025, an employee share sale valued the company at $500 billion making it the most valuable privately owned company surpassing SpaceX.
On the 17th of November 2023, Sam Altman was removed as CEO when its board cited lack of confidence in him. Helen Toner, Ilya Sutskever, Adam D'Angelo, and Tasha McCauley composed the board. Chief Technology Officer Mira Murati took over as interim CEO. Greg Brockman resigned from his presidency shortly after being removed as chairman. Three senior researchers including Jakub Pachocki and Szymon Sidor subsequently left the company.
Talks emerged on the 18th of November 2023 about Altman returning amid pressure from investors like Microsoft and Thrive Capital who objected to his departure. Altman considered starting a new company with former employees if reinstatement failed. Board members agreed in principle to resign if Altman returned. Negotiations failed on the 19th of November 2023 replacing Murati with Emmett Shear as interim CEO.
Microsoft CEO Satya Nadella announced Altman and Brockman would join Microsoft to lead a new advanced AI research team on the 20th of November 2023. About 738 of OpenAI's 770 employees signed an open letter stating they would quit and join Microsoft if the board did not rehire Altman. This prompted investors to consider legal action against the board.
Altman and Brockman returned to their prior roles on the 21st of November 2023 along with a reconstructed board featuring Bret Taylor as chairman and Lawrence Summers joining alongside D'Angelo. An anonymous Microsoft employee joined the board as non-voting member on the 29th of November 2023 before Microsoft resigned in July 2024. The Securities and Exchange Commission subpoenaed internal communications in February 2024 regarding alleged lack of candor misleading investors.
Many employees gradually left OpenAI following the temporary removal including most original leadership and significant numbers of AI safety researchers throughout 2024. Ilya Sutskever resigned in May 2024 succeeded by Jakub Pachocki while Jan Leike departed amid safety concerns. Greg Brockman took extended leave until November 2024. Mira Murati left the company in September 2024. Lawrence Summers resigned from the board in November 2025.
In July 2023, authors Sarah Silverman, Matthew Butterick, Paul Tremblay, and Mona Awad sued OpenAI for copyright infringement. Seventeen authors including George R.R. Martin, John Grisham, Jodi Picoult, and Jonathan Franzen joined the Authors Guild filing a class action lawsuit in September 2023 alleging illegal use of copyrighted work. The New York Times sued the company in late December 2023.
OpenAI destroyed Books1 and Books2 training datasets used to train GPT-3 revealed in May 2024. The Authors Guild believed these contained over 100,000 copyrighted books. In 2021, Whisper transcribed more than one million hours of YouTube videos into text for training GPT-4 raising concerns about violating platform terms prohibiting independent video applications.
The Intercept filed lawsuits alongside Raw Story and Alternate Media Inc on the 24th of February 2024 charting new legal strategies for digital publishers. Eight newspapers including The Mercury News, Chicago Tribune, and Orlando Sentinel sued in Southern District of New York on the 30th of April 2024 claiming illegal harvesting of articles. Sixteen anonymous plaintiffs claimed scraping 300 billion words online without consent in June 2023.
On the 26th of November 2024, Suchir Balaji died by suicide after accusing OpenAI of violating copyright law during an interview. His death prompted conspiracy theories alleging deliberate silencing. California Congressman Ro Khanna endorsed calls for investigation. Ziff Davis sued OpenAI in Delaware federal court on the 24th of April 2025 known for publications like PCMag and CNET.
In August 2025, parents of a 16-year-old boy who died by suicide filed wrongful death allegations against OpenAI. Conversations about mental health contributed to their son's death according to the complaint filed in San Francisco state court. Seven lawsuits were filed in November 2025 on behalf of four individuals committing suicide after prolonged ChatGPT usage. First County Bank sued following Suzanne Adams' murder in December 2025 alleging chatbot psychosis induced paranoia in her son.
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Common questions
When was OpenAI founded and who were the co-chairs?
OpenAI emerged as a not-for-profit organization in Delaware on the 1st of December 2015. Sam Altman and Elon Musk served as co-chairs alongside Ilya Sutskever, Greg Brockman, Trevor Blackwell, Vicki Cheung, Andrej Karpathy, Durk Kingma, John Schulman, Pamela Vagata, and Wojciech Zaremba.
What happened to OpenAI's legal status in February 2019?
In 2019, OpenAI transitioned from non-profit status to become a capped-for-profit entity. This model allowed profit to be capped at 100 times any investment while enabling OpenAI Global LLC to legally attract venture fund investment.
Who sued OpenAI for copyright infringement in July 2023?
Authors Sarah Silverman, Matthew Butterick, Paul Tremblay, and Mona Awad sued OpenAI for copyright infringement in July 2023. Seventeen authors including George R.R. Martin, John Grisham, Jodi Picoult, and Jonathan Franzen joined the Authors Guild filing a class action lawsuit in September 2023.
When did Elon Musk file a lawsuit against OpenAI and Sam Altman?
Elon Musk filed a lawsuit against OpenAI and Sam Altman on the 29th of February 2024. He accused them of shifting focus from public benefit to profit maximization before OpenAI dismissed the case as incoherent and frivolous.
How much capital did OpenAI raise in October 2024 and what was its valuation?
In October 2024, OpenAI completed a $6.6 billion capital raise achieving a $157 billion valuation. The funding included investments from Microsoft, Nvidia, and SoftBank.