Elon Musk’s $100 Billion OpenAI Bid: A Stunt with a Point or a Serious Question About AI Governance?

Question: Who is OpenAi accountable to: The non-profit mission or the for-profit investors looking for returns? So, who does AI answer to; and it's not clear.

In early February 2025, Elon Musk dropped a bombshell: a $97.4 billion bid to buy OpenAI, the organization behind ChatGPT and earlier GPT models that have reshaped the AI landscape. The tech world buzzed with speculation—could Musk, the billionaire trailblazer behind Tesla, SpaceX, and xAI, really pull off such a move? Yet, just days later, on February 14, OpenAI’s board unanimously rejected the offer, with CEO Sam Altman quipping on social media, “No thank you, but we’ll buy Twitter for $9.74 billion if you want.” The bid, it turns out, wasn’t meant to succeed. Musk himself signaled as much in court filings, offering to withdraw it if OpenAI halted its shift to a for-profit model. So, what was this all about? Was it just Musk flexing his financial muscle, or was there a deeper point?

The answer lies in a tangled web of governance, mission drift, and the big question haunting AI’s rise: who does it serve? Musk’s bid wasn’t about ownership—it was a spotlight aimed at OpenAI’s murky structure and a warning about accountability in an industry that could define humanity’s future. OpenAI started as a nonprofit dedicated to advancing AI for the public good, but it has since morphed into a hybrid beast with a for-profit arm backed by billions from Microsoft and other investors. Musk’s stunt forces us to ask: is OpenAI still accountable to its original mission, or has it become a tool for profit-hungry investors? And more broadly, who should AI answer to—the public or the shareholders?

The Bid That Wasn’t Meant to Be

Let’s rewind to early February 2025. Musk, alongside a consortium of investors including his AI venture xAI, Valor Equity Partners, and others, lobbed a $97.4 billion offer at OpenAI’s nonprofit parent. The number was eye-popping, but the context was even more eyebrow-raising. OpenAI was in the midst of transitioning from its nonprofit roots to a more conventional for-profit structure—a Delaware Public Benefit Corporation (PBC), to be exact. This shift would balance profit-making with a commitment to societal good, or so the pitch went. Musk, a co-founder of OpenAI in 2015 who left in 2018 over strategic disagreements, had been vocal about his disdain for this evolution. He’d sued OpenAI in 2024, alleging it betrayed its nonprofit ethos by cozying up to Microsoft and prioritizing profit over safety and openness.

The bid came with a twist: Musk’s lawyers said he’d drop it if OpenAI abandoned its for-profit plans. It was less a serious takeover attempt and more a chess move—an attempt to expose what Musk saw as hypocrisy. OpenAI’s board didn’t bite. Bret Taylor, the board chair, called it “an attempt to disrupt his competition,” and the rejection was swift and unanimous. Sources close to the matter told Reuters that no formal offer even reached the board by February 11, suggesting Musk’s announcement was more theater than transaction.

So why bother? Musk’s play wasn’t about winning OpenAI—it was about winning a narrative. By dangling nearly $100 billion, he forced the world to look at OpenAI’s governance and ask uncomfortable questions. If the nonprofit could be bought, what did that say about its mission? If it couldn’t, why was it pivoting to a for-profit model anyway? The bid was a provocation, and it worked. We’re talking about it today, February 24, 2025, because it hit a nerve.

OpenAI’s Origins: A Nonprofit Dream

To understand the stakes, we need to go back to 2015. OpenAI was born out of a shared vision among Musk, Sam Altman, and others to advance AI research in a way that countered the dominance of tech giants like Google. The plan was simple: make it a nonprofit, keep it open-source, and focus on AI that benefits humanity, not corporate bottom lines. Musk famously said he named it “Open” AI to reflect that ethos. He chipped in around $45 million before parting ways in 2018, reportedly frustrated by its direction and his lack of control.

The nonprofit model made sense at first. AI research is expensive—think supercomputers, top-tier talent, and endless experimentation. A nonprofit could sidestep shareholder pressure and prioritize long-term goals over quarterly earnings. But by 2019, reality hit. OpenAI needed more cash than donations could provide. Enter OpenAI LP, a “capped-profit” subsidiary designed to attract investment while still tying back to the nonprofit’s mission. Microsoft led the charge, pouring in billions—$1 billion in 2019, $10 billion more by 2023—alongside other backers like SoftBank. The structure was a hybrid: the nonprofit board oversaw the whole operation, but the for-profit arm could raise funds and commercialize tech like ChatGPT.

It Worked—too well, perhaps. OpenAI’s valuation soared past $150 billion by late 2024, and ChatGPT became a household name. But the hybrid model sparked tension. Musk argued it turned OpenAI into a “closed-source, maximum-profit company effectively controlled by Microsoft,” a far cry from its roots. The 2025 shift to a PBC, which would fully convert the for-profit arm into a standalone entity while paying the nonprofit for its assets, only fueled his critique. Was this still about the public good, or had investors hijacked the mission?

The Governance Puzzle

Musk’s bid shone a harsh light on OpenAI’s governance—who’s really in charge? The nonprofit board, led by figures like Bret Taylor, has no fiduciary duty to maximize profit, unlike a typical corporate board. Its loyalty is to OpenAI’s charter: ensuring artificial general intelligence (AGI) benefits all of humanity. That gave it the freedom to reject Musk’s offer without batting an eye. Under Delaware law, where OpenAI is registered, nonprofits must consider acquisition offers seriously, but they can say no if the deal doesn’t align with their mission. Taylor’s statement—“OpenAI is not for sale”—drove that home.

But here’s the rub: the for-profit arm, OpenAI LP, answers to investors expecting returns. Microsoft, with its massive stake, isn’t in this for charity. The PBC transition aims to formalize this split, letting the for-profit entity chase revenue while the nonprofit gets a payout—estimated at $30 billion—to fund its work. Musk’s $97.4 billion bid dwarfed that figure, implying the nonprofit’s assets (its IP, essentially) are worth far more. His point? If OpenAI’s tech is so valuable, why sell it to the for-profit side for a fraction of its potential?

This gets to the heart of the accountability question. The nonprofit board controls the mission, but the for-profit arm drives the money—and increasingly, the direction. As OpenAI races toward AGI, who calls the shots? The board, with its lofty ideals, or the investors, with their deep pockets? Musk’s stunt suggests the latter, and he’s not alone in worrying. Posts on X in early 2025 echoed his sentiment, with users questioning whether OpenAI’s structure lets it dodge taxes as a nonprofit while raking in profits—a setup one called “too good to be true.”

The Bigger Picture: AI for Whom?

Zoom out, and Musk’s bid isn’t just about OpenAI—it’s about AI itself. The stakes couldn’t be higher. AGI, the holy grail of AI research, promises (or threatens) to outthink humans. OpenAI’s charter vows to make it a boon for all, not a toy for the elite. But as AI firms like OpenAI, xAI, and Google’s DeepMind burn billions chasing that prize, the tension between profit and purpose grows.

Musk’s critique isn’t new—he’s been harping on OpenAI’s “mission drift” since 2023, when he tweeted it had become a “closed-source, profit-maximizer.” His own AI venture, xAI, aims to accelerate human discovery, but it’s not open-source either (only its first Grok model was released publicly). Critics call him a hypocrite, but his point stands: if AI’s future hinges on private capital, who ensures it serves the public? OpenAI’s hybrid model was meant to bridge that gap, but Musk argues it’s failing. His bid dramatized that failure, suggesting the nonprofit could be bought out—or at least tempted—by the right price.

OpenAI’s response? Double down. After rejecting Musk, reports surfaced on February 18 that it’s mulling “special voting rights” for its nonprofit board, giving it outsized control over the PBC. Think of it as a poison pill—a way to fend off hostile takeovers and keep investors in check. It’s a bold move, but it sidesteps the core issue: as AI’s power grows, so does the influence of those funding it. Microsoft, with its $13 billion investment, isn’t a silent partner. If AGI arrives, will it prioritize humanity—or shareholders?

Why It Matters

Musk’s $100 billion gambit didn’t win him OpenAI, but it won attention. On this quiet Monday morning, February 24, 2025, we’re left wrestling with his point. OpenAI’s journey from nonprofit dreamer to for-profit titan mirrors AI’s own evolution—idealistic roots giving way to pragmatic realities. The governance mess—Musk’s real target—exposes a flaw: no one’s quite sure who OpenAI answers to. The board? The investors? The public it promised to serve?

This isn’t just about one company. AI’s trajectory will shape economies, societies, and even geopolitics. If it’s accountable only to profit, the risks—bias, misuse, inequality—multiply. Musk, for all his bravado, forced a reckoning. OpenAI says it’s “not for sale,” but its structure suggests otherwise. The bid was a stunt, yes, but a damn important one. It’s a wake-up call: if we don’t sort out who controls AI, we might not like who it controls in the end.