Going to IPO? OpenAI Appoints CFO

On Monday local time, the world's leading AI unicorn OpenAI announced the appointment of Silicon Valley veteran Sarah Friar as the company's new CFO, sparking speculation about whether OpenAI is planning an IPO.

Public information shows that Sarah Friar previously served as the CEO of the social media company NextDoor. She has also served as the CFO of Square (now known as Block), one of the largest payment platforms in the United States, and as the Senior Vice President of Finance and Strategy at Salesforce. Prior to that, she spent 10 years at Goldman Sachs as a software industry analyst.

In addition to her role as OpenAI CFO, Friar is also a board member of retail giant Walmart and blockchain software company Consensys. She is also the Co-Chair of the Stanford Digital Economy Lab.

Previously, OpenAI did not have a CFO position, with financial functions being overseen by Chief Operating Officer Brad Lightcap. Regarding the question of whether they plan to IPO, OpenAI did not directly respond, but a spokesperson stated:

We have grown to a scale where it is necessary to establish a dedicated financial executive.

Generally, the establishment of a CFO position in a company is often seen as an important signal that it is preparing for an IPO. Publicly traded companies need to comply with various financial regulations and disclosure requirements. As the highest financial officer, the CFO is responsible for financial statement preparation, internal controls, tax planning, fund management, etc., ensuring the compliance and transparency of financial operations. These are all essential foundations for an IPO and being listed.

Friar stated on X:

I am excited to join OpenAI! Looking forward to contributing to the AI revolution for humanity. As Co-Chair of the Stanford Digital Economy Lab and a board member of Walmart and Consensys, I have witnessed the profound impact of AI.

As I have seen at NextDoor and Square, the meaning of a career is crucial. This top-notch research institution is developing general artificial intelligence for the benefit of all mankind—there is no greater purpose in a career than this.

It is worth mentioning that OpenAI played a significant role at this week's Apple WWDC conference. Apple announced that it will integrate OpenAI's large language model ChatGPT into its iOS, macOS, and iPadOS systems in the future, which is expected to bring substantial revenue opportunities to OpenAI At the same time, OpenAI has also appointed Kevin Weil as Chief Product Officer. Weil previously served as the Chief Product and Business Officer at the satellite imaging company Planet Labs, and has also worked at Facebook, Instagram, and Twitter.

It is worth noting that OpenAI's structure is different from many businesses. As a non-profit organization, its goal is to ensure that artificial intelligence benefits all of humanity. In 2019, in order to raise more funds to support its expensive research and development work, OpenAI underwent a restructuring and established a "capped-profit" subsidiary called OpenAI LP. This structure allows investors to receive returns, but the return cap is set at 100 times their investment to maintain the company's mission-driven and public interest-oriented approach.

If OpenAI goes public through OpenAI LP, it will still adhere to the "capped-profit" structure. The channel through which funds are obtained from the public market will not affect this, and the constraints of the "return cap" rule will remain in place.

However, the issue lies in the fact that public companies typically face pressure from shareholders to achieve financial returns. This may pose a challenge to OpenAI's original mission of ensuring that AI benefits all of humanity. Balancing shareholder interests with its long-term mission will be a key issue