OpenAI must complete for-profit transition by year-end to raise full $40 billion

OpenAI must transition to a for-profit company by the end of the year to secure the full $40 billion funding led by SoftBank it is in the final stages of raising, a person familiar with the matter said on Friday.

SoftBank can pare back the size of the funding round to $20 billion if Microsoft-backed OpenAI fails to restructure into a for-profit company by the end of the year.

The Wall Street Journal was the first to report the news earlier in the day.

This would mark an accelerated deadline for OpenAI to pull off its complicated transition. It was…