OpenAI's restructuring could pave the way for a future IPO, though any move in that direction would depend on market conditions and the company’s preparedness, Chief Financial Officer Sarah Friar said on Wednesday at an event.
In December, OpenAI announced plans to convert its for-profit arm into a public benefit corporation (PBC) — a structure designed to balance profit-making with broader social objectives, unlike traditional non-profits, which focus exclusively on public good.
Earlier this month, OpenAI revised those plans to ensure its non-profit parent organisation retains control over the for-profit arm, which is now a PBC. The non-profit has acquired a significant shareholding in the PBC, giving it stronger oversight. At the same time, the new structure allows the for-profit entity to continue raising capital to remain competitive in the rapidly evolving AI industry.
“A PBC gets us to an IPO-able event ... if and when we want to,” Friar said at the Dublin Tech Summit, according to Reuters.
“Nobody tweet in this room that Sarah Friar just said anything about OpenAI ultimately going public,” she added. “I did not. I said it could happen.”
When asked what would influence such a decision, Friar explained that, like any company considering a public offering, both the business and the market must be ready.
“You can show up at the altar all ready to go, and if the market's not ready for you, yeah, you're just out of luck. Which is why you have to build a company that can be sustainable and safe regardless of where the public markets are, how open that window is,” she said.
To be a public company, “you definitely need some sense of predictability,” Friar added.
“The market will put up with a certain degree of unpredictability — particularly when growth is high — but the market doesn’t really love it.”
To explain the scale of investment OpenAI may require, Friar pointed out that a 1-gigawatt data centre costs around $50 billion — and the company’s ambition over the next few years is to scale up to nearly 10 gigawatts. She identified the rapidly growing AI search market as a key priority, stating that while OpenAI would seek efficiencies, its focus remains on creating the next breakthrough product.
“The search market is becoming a big market,” she said. “In that world, I don’t want people spending too much time trying to save an extra 1% — I’d rather they focus on building the next state-of-the-art product.”
