Re: Dear General Bonta:

As a California-based company that builds Generative AI technology, Meta is deeply concerned about OpenAI’s attempt to shed its non-profit status and rebrand as a for-profit entity. We urge California’s Attorney General, Bob Bonta, to intervene and hold OpenAI accountable for its actions.

OpenAI’s Original Purpose

In its original certificate of incorporation dated 2015, OpenAI stated that it intended to be a non-profit corporation organized exclusively for charitable and educational purposes. Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, exempts organizations from federal tax on income and provides no part of the net earnings inures to the benefit of any private shareholder, director, or officer of the corporation.

OpenAI’s Reaffirmations

In its own words on its website, OpenAI reaffirmed its commitment to the public good, aiming to direct the development of safe and broadly beneficial General Artificial Intelligence (AGI) without profit incentives while remaining unencumbered by profit motivations.

Critique of OpenAI

Taking advantage of its non-profit status, OpenAI raised billions in capital from investors, pledging to operate without profitability. However, OpenAI now seeks to change course, converting its non-profit status to a for-profit entity, potentially reapproaching the assets it established as a charity for unprecedented private gains.

Possible Consequences

If Permitting OpenAI’s Planned Restructuring

There are severe implications for Startups in Silicon Valley in the event OpenAI pursues this path. Raising capital as a charitable organization, OpenAI receives tax-free donations, free from scrutiny, and distribution of assets to third party entities. This could ensue in a paradigm Shift for Startups, promoting a similar playbook for tax-free fundraising and eventual assumed for-profit status.

California’s Interests

As a respected institution, OpenAI bears a fiduciary role to California, having generated significant benefits from the technology developed within the state while leveraging public resources. Investors and the public have depended on OpenAI’s publicly stated mission, and thus, its actions have actual and direct consequences for us.

Action Required

We urge intervention by your office to effectively review the proposed transaction encompassing the nature and extent of the transfer of open AI’s non-profit-based assets to other entities concerned. Failure to hold a non-profit accountable for adopting a for-profit status quo could lead to a domino effect of similar projects.

Conclusion

Protecting California’s Interest

We believe that accountability is crucial in this highly competitive AI landscape. Recognizing OpenAI’s impact on California, we rely on your office to stop this for-profit conversion which could undermine the integrity the public’s trust in foundations. As a responsible agent, Meta Platforms, firmly committed to openness and fairness, stands ready to voice our concerns and support to safeguard California’s interests on this critical matter.

Regarding OpenAI’s proposed conduct, we would like

FAQs

Q- What is OpenAI ‘s current status?
A- Open AI is a non-profit.

Q- What is META’s stance on Openai’s planned restructuring?
A- Meta Platforms, urge California’s Attorney General

Q- What are they concerned about?
A-A potential for-profit conversion violating OpenAI’s original intended purpose and potentially leading market distortion

Q- To whom can I direct Questions or Concerns?

A- Contact Meta through the provided email address