OpenAI Files for IPO

ChatGPT maker OpenAI has filed preliminary paperwork that would open the door to it becoming a publicly traded company, making itself the third in a powerhouse trio of artificial intelligence companies racing to Wall Street debuts. The company said Monday it has filed confidential paperwork with the US Securities and Exchange Commission.

• "We expect it to leak so we're just announcing it," the company said in a written statement. "We have not decided on timing yet; it may be a while because there are things we want to do that are likely easier as a private company. But it's a complicated set of tradeoffs and this gives us the option to go public sooner if that ends up being best."

OpenAI's move follows its rival Anthropic's June 1 disclosure that it is also moving toward an initial public offering of shares. Both are now following Elon Musk's space company SpaceX, which has started an IPO roadshow pitching itself as an AI-focused space company. OpenAI CEO Sam Altman first publicly floated the possibility of an IPO last fall, describing it as the "most likely path" for the company given its size and the need for vast amounts of capital to advance its technology. OpenAI began in 2015 as a nonprofit d edicated to developing AI for the common good and is now a company valued at $852 billion.

Paving the way for going public was OpenAI's decision last year to reorganize its business structure and convert itself into a public benefit corporation, even as it remains technically under the control of a nonprofit. SpaceX's IPO later this week is expected to be the biggest in history. Anthropic's listing is expected this fall. Bankers have told both OpenAI and Anthropic that whichever company is first could benefit from investors' eagerness to put money into the new industry, the Wall Street Journal reports. But it could be a long time before OpenAI appears in the S&P 500: The index provider said last week that it won't bend its profitability rules to let SpaceX and other money-losing companies appear in the index immediately.