Hello, Reader.
OpenAI is on a mission… to fulfill its mission.
The company, founded as a nonprofit research lab in 2015, formed its mission to “ensure that artificial general intelligence [AGI] – AI systems that are generally smarter than humans – benefits all of humanity.”
No individual or company has achieved AGI yet. But after this week, OpenAI could be one step closer…
The company announced changes to its structure and new provisions to its partnership with Microsoft Corp. (MSFT). And this news has big implications for the future of AGI.
The development of this superhuman intelligence is a trend that I have been keeping a close eye on, and it is alive and well. In fact, experts believe it could arrive as soon as next year.
So, in today’s Smart Money, I’ll dive into how OpenAI’s latest news signals a major acceleration toward the company’s long-term goal of AGI.
Then, I’ll share the best ways to prepare for AGI’s arrival, all while growing your wealth.
Let’s jump in…
The New Microsoft-OpenAI Alliance
OpenAI struck a new partnership with Microsoft this week, but this isn’t the first for the pair.
The two companies officially started their partnership in 2019, when Microsoft invested $1 billion in the AI startup. That same year, knowing AI spending would only grow, OpenAI created a for-profit subsidiary to help scale its research and development efforts, with its nonprofit entity in control. (That becomes important in a bit.)
AGI was at the center of this initial partnership. And through it, Microsoft attained the rights to use OpenAI’s technology until it achieved AGI. Fast forward to this year, and Microsoft’s investment in OpenAI has totaled more than $13 billion.
Both companies benefit from using and building on each other’s new and existing AI models and have long supported each other financially… for better or worse. (During the recent quarter, OpenAI lost about $11.5 billion, costing Microsoft $3.1 billion of its net income.)
Then on Tuesday, OpenAI announced a new chapter in its partnership with Microsoft. One that gives the latter a 27% equity stake in the startup. And it’s all thanks to a new restructuring…
Inside OpenAI’s New Structure
OpenAI says it has finalized its previously controversial for-profit restructuring.
Remember when I said that the startup had created a for-profit subsidiary? Well, that subsidiary has now converted into a public benefit corporation called OpenAI Group PBC. This move resulted in a recapitalization that Microsoft had to approve, hence the new partnership.
The nonprofit entity is now called the OpenAI Foundation. It controls OpenAI Group, and both of them have the same AGI-focused mission.
Following this announcement, Microsoft now holds a $135 billion investment in the company. This new agreement allows Microsoft to keep its exclusive IP and Azure API rights until OpenAI achieves AGI. But new provisions were added.
The ones pertinent to AGI include…
- Once AGI is declared by OpenAI, that declaration will now be verified by an independent expert panel.
- Microsoft’s IP rights for both models and products are extended through 2032 and now includes models post-AGI, with appropriate safety guardrails.
- Microsoft can now independently pursue AGI alone or in partnership with third parties.
These changes mean three things for certain: 1) Microsoft and OpenAI are continuing their close partnership, 2) AGI is still anyone’s game… now including Microsoft’s, and 3) a lot of money is involved.
It is important to note that OpenAI’s restructuring frees it to scale like a tech giant. This is significant because true AGI research requires enormous compute resources, data, and long-term funding. So, the company is indisputably gearing up to build the hardware and training infrastructure AGI will require.
What’s more, OpenAI is now also considering filing for an initial public offering (IPO) as soon as the second half of 2026. Chief Financial Officer Sarah Friar confirmed that the company’s restructuring is part of positioning for a public listing.
It is laying the groundwork to raise funds that could value the company at up to $1 trillion. This would be among the largest IPOs ever, and further signals OpenAI’s need for large future capital needs to fund infrastructure and research AGI.
Discussions around the IPO indicate strong investor and market confidence in AI’s growth potential… and, subsequently, AGI’s growth potential.
Now, that was a lot of shop talk. But here’s what it all means for us investors…
The Smart Way to Position for AGI
OpenAI’s restructuring is a reminder that this powerful new technology may be around the corner. And in this new world, AGI could create immense wealth for early investors.
That is why in my free The Road to AGI: Final Warning broadcast, I show you how you can get in on AGI’s ground floor. I detail my three-part “future proof” blueprint for a world of rapidly accelerating AI.
That blueprint features…
- The reasons why energy, real estate, and biotech are some of the most dynamic ways to play AGI.
- My No. 1 AGI-related stock pick with limitless potential on the Road to AGI.
- Details on critical stocks to avoid or sell immediately before they collapse.
I also dive deep into the unprecedented dangers AGI represents for the world… and the even more unprecedented opportunities AGI presents to investors.
Rather than buying into expensive top-dog companies, like Microsoft (or maybe soon OpenAI itself) – with little growth left – I’ve identified three categories of AI investment that are the only ones to buy right now.
Everything that falls outside these categories is either too risky… or on its way out.
Regards,
Eric Fry
