Masayoshi Son's Ladder Remains Pulled Up: The Trap of OpenAI's Nonprofit Structure and SBG's Maze Without an Exit
Rintaro Takechi (Editor-in-Chief, Weekly Bubble Watch)
May 7, 2025
Today, I will organize the current situation of OpenAI and SoftBank Group (SBG) based on materials already published by overseas quality magazines and U.S. authorities, which for some reason the Nikkei newspaper does not report. You may be surprised by the gap between this and the 'super-optimistic scenario' believed in Japan, but please be prepared to read this.
1. Strengthening Nonprofit Governance: The 'Independent PBC Proposal' Has Vanished
Born as a nonprofit in 2015, OpenAI transitioned to a 'hybrid management structure' in 2019 that included a for-profit division (OpenAI LP). Furthermore, it had been considering a proposal to upgrade the for-profit division into an independent Public Benefit Corporation (PBC).
However, on May 5, 2025, the board of directors announced, 'We will proceed with the PBC conversion, but will strictly remain under the control of the nonprofit corporation (OpenAI Inc.).' In short, it was settled as a 'tethered PBC' where investors do not hold voting rights. The much-hyped 'PBC IPO plan that opens common stock to investors' has completely evaporated.
A PBC is a 'for-profit company that pursues a public benefit purpose' under Delaware law. Directors may prioritize the public mission over maximizing shareholder value. The key point is that this 'public interest shield' makes it difficult for external investors to interfere in management.
2. Zero Profits Since Inception: Accumulated Deficit Reaching the 1.4 Trillion Yen Scale
2024 Financial Results: Revenue $3.7 billion, Net Loss $5 billion
Cost Breakdown (Estimated):
・Training costs: $3 billion
・Inference costs: $2 billion
・Personnel costs: $0.7 billion
The accumulated deficit since 2016 exceeds $10 billion. If the current pace continues, it will reach the $20 billion range in 2026.
3. The Endless Bleeding of 'AGI Upfront Investment'
Stargate Project:Involving SBG and Oracle, a new group of data centers worth $50 billion is under construction.
Microsoft Dependency:While obtaining bulk discounts through a dedicated Azure contract, they face risks from the 'valve' controlled by the company.
Revenue Share Reduction:OpenAI explained that it will compress its revenue share to Microsoft from 20% to 10% by 2030.
They claim they will 'turn a profit with $125 billion in revenue by 2029,' but no roadmap for covering the accumulated losses has been presented.
1. Musk Lawsuit: Tug-of-War Over Initial Contract Violations
In March 2024, co-founder Elon Musk sued OpenAI for violating the founding agreement of being 'nonprofit and open source.' Although most of the injunction requests were dismissed in March 2025, the claim of breach of public trust remains a point of contention.
Elon Musk to go ahead with lawsuit against OpenAI despite nonprofit control statement, lawyer says
By Reuters
May 6, 20259:24 PM GMT+9Updated 21 hours ago
5. Is Microsoft an Ally of OpenAI, or Its Master?
Cumulative investment: Approximately $13 billion through convertible bonds and other instruments.
Technical dominance: When new major shareholders join, a de facto veto can be exercised based on the Azure license agreement.
Cloud dependency: Approximately 3/4 of OpenAI's inference requests are processed on Azure.
The outward partnership is, in reality, closer to a control relationship where one party holds the 'cloud faucet'—the lifeline.
6. The Collapse of SBG's Scenario
SBG had drafted a blueprint of 'acquiring voting rights via PBC -> investing an additional $40 billion.' However,
• The existing $10 billion investment is locked up in a non-listed, non-dividend state.
• The additional $30 billion quota is frozen, contingent on an 'independent PBC' structure.
• The investment schedule announced by SoftBank requires renegotiation.
7. Three Options Remaining for Masayoshi Son
One, Clinging to the Dream:Attempting to demand a conversion to a for-profit entity again and strengthen influence with additional capital. Specifically, there is a possibility of attempting to renegotiate OpenAI's nonprofit governance structure to secure voting rights for investors. However, Microsoft retains a de facto veto based on the Azure contract, and Elon Musk's lawsuit regarding the breach of public trust is ongoing. Since both stand as barriers, realization is extremely difficult.
Two, Galapagos LLM:Utilizing SB OpenAI Japan to develop a large language model (LLM) specialized for the Japanese market. The goal would be to optimize for Japanese data and domestic needs to expand revenue within the domestic market. However, this approach carries the risk of isolation from global standard AI development, likely leaving it behind in international competition. Furthermore, since the growth potential of the Japanese market itself is limited, securing revenue remains uncertain.
Three, Withdrawal and Debt Compression:Accepting impairment losses, liquidating investment assets, and focusing on corporate bond redemption. Effectively, it becomes impossible to pay off debt with more debt, and the focus shifts to securing cash flow through asset sales. In the worst-case scenario, SoftBank Group could face financial collapse, and Masayoshi Son's story could end with the 'bet on a massive risk' ultimately falling apart.
All three of these options are drastic measures; SBG has much to lose, and every remaining choice comes with a severe price.
1. The Irony of Ethical Capitalism
OpenAI has perfected an 'investor exclusion device' where funds are welcomed, but voting rights are turned away at the door, all while claiming to serve the 'public good.'
Will Masayoshi Son choose the fiction of continuing to chant that 'AI is ten thousand times the wisdom of humanity,' or the aesthetics of a withdrawal that faces up to debt? Who will be the next to have the ladder pulled out from under them: Masayoshi Son, or the giant tower that is SoftBank? The final chapter of the story has already begun.
Rintaro Takechi