Current and former OpenAI employees are increasingly frustrated by the fact that the company has not allowed them to donate their capital to charity for years. But OpenAI appears to have finally succumbed to the pressure, sending out an email from the company's shareholder team saying that current and former employees with qualifying shares will be able to participate, according to a memo reviewed by Edge.
There's a lot of money at stake: they could give employees who made six-figure stock deals in 2019 the opportunity to donate millions of dollars to charity.
This was reported by a source familiar with the situation. Edge that the company was about 18 months late in delivering on its promise, adding that this was especially concerning because charitable equity donation is something the company has used in the past as a way to attract new employees, especially as the wars for AI talent heat up. OpenAI competitor Anthropic offers additional 1:1 matching donations for “up to 25% of your equity grant” on its careers webpage.
Another catch: It's a quick deadline for participants to decide on the amount and details of the donation, which is significantly shorter than the minimum. on behalf of the SEC time period for other types of liquidation decisions, for example 20 business days for a tender offer. The source said the short deadline means some people are finding it difficult to take part, especially because the OpenAI email strongly encourages participants to work with a tax or financial advisor to make a decision, and that some people have fewer units to donate due to a lack of notice and the indefinite suspension of past plans. OpenAI did not immediately respond to a request for comment.
The decision comes after OpenAI employees grew increasingly concerned for years about the company's control over their capital as its valuation skyrocketed and its corporate structure changed. In the past the company has accepted restrictive approach that raises red flags for current and former employees, including concerns that OpenAI may return his capital if employees have violated non-disparagement agreements – and employees are increasingly voicing their concerns this year in Slack discussions and general meetings that they were unable to donate.
Previous rounds of donations took place in 2021 and 2022, but current and former employees were frustrated by the gap since the last round of donations. Last year, after OpenAI allowed employees to sell about $1.5 billion in shares in SoftBank's tender offer employees they said expected to make a charitable donation shortly thereafter, but it was postponed indefinitely. Now that OpenAI has completed a mega-funding round and commercial restructuring, the company is allegedly easing restrictions.
Late last month, OpenAI announced the end of the project. restructuringnegotiations on which were conducted with the attorneys general of California and Delaware for more than a year. The company was founded in 2015 as a non-profit research laboratory. One of the most important questions is whether the nonprofit OpenAI will retain control over the technologies it creates, most notably the potential development of artificial general intelligence, or AGI—systems that equal or exceed human cognitive abilities.
OpenAI's per-share price has also risen significantly since last month, when current and former employees were able to tender their stake for about $430 per share—each share is now worth about $483 in fair market value terms, according to the source, who added that they believe the sharp jump is partly due to OpenAI no longer owing as much potential future earnings to its nonprofit as it once did.
