Documents show OpenAI's long journey from nonprofit to $157B valued company

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Documents show OpenAI's long journey from nonprofit to $157B valued company

2024-10-13 05:52 Last Updated At：06:00

Back in 2016, a scientific research organization incorporated in Delaware and based in Mountain View, California, applied to be recognized as a tax-exempt charitable organization by the Internal Revenue Service.

Called OpenAI, the nonprofit told the IRS its goal was to “advance digital intelligence in the way that is most likely to benefit humanity as a whole, unconstrained by a need to generate financial return.”

Its assets included a $10 million loan from one of its four founding directors and now CEO, Sam Altman.

The application, which nonprofits are required to disclose and which OpenAI provided to The Associated Press, offers a view back in time to the origins of the artificial intelligence giant that has since grown to include a for-profit subsidiary recently valued at $157 billion by investors.

It's one measure of the vast distance OpenAI — and the technology that it researches and develops — has traveled in under a decade.

In the application, OpenAI indicated it did not plan to enter into any joint ventures with for-profit organizations, which it has since done. It also said it did “not plan to play any role in developing commercial products or equipment,” and promised to make its research freely available to the public.

A spokesperson for OpenAI, Liz Bourgeois, said in an email that the organization’s missions and goals have remained constant, though the way it’s carried out its mission has evolved alongside advances in technology. She also said the nonprofit does not carry out any commercial activities.

Attorneys who specialize in advising nonprofits have been watching OpenAI's meteoric rise and its changing structure closely. Some wonder if its size and the scale of its current ambitions have reached or exceeded the limits of how nonprofits and for-profits may interact. They also wonder the extent to which its primary activities advance its charitable mission, which it must, and whether some may privately benefit from its work, which is prohibited.

In general, nonprofit experts agree that OpenAI has gone to great lengths to arrange its corporate structure to comply with the rules that govern nonprofit organizations. OpenAI's application to the IRS appears typical, said Andrew Steinberg, counsel at Venable LLP and a member of the American Bar Association’s nonprofit organizations committee.

If the organization’s plans and structure changed, it would need to report that information on its annual tax returns, Steinberg said, which it has.

“At the time that the IRS reviewed the application, there wasn’t information that that corporate structure that exists today and the investment structure that they pursued was what they had in mind,” he said. “And that’s okay because that may have developed later.”

Here are some highlights from the application:

At inception, OpenAI's research plans look quaint in light of the race to develop AI that was in part set off by its release of ChatGPT in 2022.

OpenAI told the IRS it planned to train an AI agent to solve a wide variety of games. It aimed to build a robot to perform housework and to develop a technology that could “follow complex instructions in natural language.”

Today, its products, which include text-to-image generators and chatbots that can detect emotion and write code, far exceed those technical thresholds.

The nonprofit OpenAI indicated on the application form that it had no plans to enter into joint ventures with for-profit entities.

It also wrote, “OpenAI does not plan to play any role in developing commercial products or equipment. It intends to make its research freely available to the public on a nondiscriminatory basis.”

OpenAI spokesperson Bourgeois said the organization believes the best way to accomplish its mission is to develop products that help people use AI to solve problems, including many products it offers for free. But they also believe developing commercial partnerships has helped further their mission, she said.

OpenAI reported to the IRS in 2016 that regularly sharing its research “with the general public is central to the mission of OpenAI. OpenAI will regularly release its research results on its website and share software it has developed with the world under open source software licenses.”

It also wrote it “intends to retain the ownership of any intellectual property it develops.”

The value of that intellectual property and whether it belongs to the nonprofit or for-profit subsidiary could become important questions if OpenAI decides to alter its corporate structure, as Altman confirmed in September it was considering.

The Associated Press and OpenAI have a licensing and technology agreement that allows OpenAI access to part of AP’s text archives.

Associated Press coverage of philanthropy and nonprofits receives support through the AP’s collaboration with The Conversation US, with funding from Lilly Endowment Inc. The AP is solely responsible for this content. For all of AP’s philanthropy coverage, visit https://apnews.com/hub/philanthropy.

Lindsey Vonn takes a low-risk approach and places 14th in her return to World Cup skiing at age 40

2024-12-21 22:19 Last Updated At：22:21

ST. MORITZ, Switzerland (AP) — Lindsey Vonn was not about to put everything on the line in her first World Cup race back after more than five years of retirement.

Not with her history of crashes and injuries.

Not with her new titanium knee.

Not at age 40.

Vonn took a low-risk approach and finished 14th in a super-G on Saturday, crossing 1.18 seconds behind Austrian winner Cornelia Huetter.

“This was the perfect start,” Vonn said. “Today is just the first step and I’m not looking for more. Today I really needed to get to the finish. I wanted to have a solid result. And that’s exactly what I did.

“There’s definitely a lot that I have left to give," Vonn added. "Today was not the day to try to do anything special.”

Still, when Vonn came down, the crowd of Swiss-flag-waving fans turned silent in anticipation and all of the other top skiers watched her run on a perfectly clear day in the Alps.

“To have her back on the world stage is just fantastic,” said Sophie Goldschmidt, president and CEO of U.S. Ski and Snowboard. “Just the attention she’s bringing to the sport and the role model she is — it’s a big day.

“These kind of moments transcend outside of just sports. We see it with Mikaela (Shiffrin) and what she’s done recently, which is just superhuman as well, setting all those records."

Vonn lost time early in her run but nearly matched the top finishers in the middle and bottom section of the Corviglia course.

When she reached the finish and saw her time, Vonn flashed a wide smile and waved to the crowd.

“I didn’t risk anything with the line. I was a little bit conservative in some sections, but overall I skied really well. Now I just need my top section to be a little faster and I’ll be in really good shape,” said Vonn, who is planning to race another super-G in St. Moritz on Sunday.

Vonn finished less than a second off the podium, which also included Olympic champion Lara Gut-Behrami in second place, 0.18 behind Huetter, and Sofia Goggia in third, 0.33 back.

“I’m really close to being there," Vonn said. "I’m just not quite there yet.”

Vonn started No. 31 under a new wild card rule for former champions. But that still meant going after all of the current top-ranked skiers had raced.

“The course was a little bit bumpy when I went and so some sections I was a little bit more conservative with my line," she said. “But in some sections I was really fast.”

Vonn had to cut her career short in 2019 due to a series of crashes and injuries, but then she had knee replacement surgery in April and had two titanium pieces inserted into her right knee. Her knee feels better than it has in years, so she decided to come back.

“The last few years of my career were so much different than they are right now," Vonn said. "I’m skiing without thinking about my knee, which I really haven’t done since I first tore my ACL in 2013. So it’s been a long time that I felt this good and I’m a little bit older, but honestly, I’m a hell of a lot stronger than I once was.”

Eight-time overall World Cup champion Marcel Hirscher also took advantage of the wild card rule and returned this season after five years away. But then Hirscher tore his left ACL while training in giant slalom and announced earlier this month that his comeback season was done.

Vonn left the tour with 82 World Cup wins — the record for a woman at the time and within reach of the then all-time Alpine mark of 86 held by Swedish standout Ingemar Stenmark. The women’s record held by Vonn was eclipsed last year by Shiffrin, who now has an outright record 99 wins.

Shiffrin, who shares the record of five wins in St. Moritz with Vonn, isn’t racing this weekend as she recovers from abdominal surgery to clean out a puncture wound she sustained in a crash last month.

Vonn is attempting to enter unchartered territory in terms of success at an advanced age in women’s skiing.

The oldest woman to win a World Cup race was Federica Brignone, the Italian who won the giant slalom in Soelden, Austria, in October to start this season, at age 34.

“It’s super impressive,” said Vonn’s U.S. teammate Jacqueline Wiles, noting that Vonn didn’t have as much preseason preparation as other skiers. “If anybody could do it, she could. The more she gets comfortable and gets kind of back up to speed, she’s going to be right in there.”

So will Vonn charge harder on Sunday?

“Step by step,” Vonn said. “Patience.”

AP skiing: https://apnews.com/hub/alpine-skiing