OpenAI's Internal Stock Trading Frenzy Last Year: Over 600 Employees Cash Out $6.6 Billion
According to The Wall Street Journal, OpenAI opened internal stock trading in October last year, allowing each employee to sell up to $30 million in shares. More than 600 current and former employees participated, cashing out a total of $6.6 billion.
About 75 individuals reached the maximum limit of $30 million. OpenAI initially set the cap at $10 million but raised it threefold due to strong demand from external investors. Employees who have been with the company for two years are eligible to sell shares, giving many new employees who joined after the release of ChatGPT their first opportunity to cash out.
In comparison, OpenAI's stock has grown over 100 times in the past seven years. President Greg Brockman confirmed in a recent court hearing that his personal equity is valued at approximately $30 billion.
By relying on a high valuation and internal liquidity mechanisms, OpenAI has made a large number of employees millionaires before its IPO, rewriting the traditional wealth creation path in Silicon Valley.
Source: Public Information
ABAB AI Insight
OpenAI's valuation skyrocketed from $14 billion at the end of 2022 to approximately $852 billion currently, and this internal trading is an unconventional measure to retain talent and meet liquidity demands, occurring well ahead of the traditional IPO timeline. The fact that 75 individuals cashed out the maximum of $30 million indicates a high concentration of wealth among early and core employees.
In terms of capital strategy, OpenAI quickly liquidated employee options by leveraging a high valuation and significantly relaxing cash-out limits, while continuing to attract top global talent, creating a positive feedback loop of "high valuation - high liquidity - high attractiveness." In contrast, traditional tech companies typically require employees to wait until after an IPO to cash out on a large scale.
Structural assessment: This essentially represents capital concentration. OpenAI rapidly concentrated wealth and opportunity among a small number of early employees and core executives through its extremely high valuation and early liquidity, breaking the old rule that one must IPO to become wealthy, and driving top talent and capital towards a few high-potential AI companies.
ABAB News · Cognitive Law
Traditional Silicon Valley creates wealth through IPOs, while OpenAI creates wealth through valuation first.
The crazier the growth, the earlier the wealth is realized.
Whoever turns the company into a cash printing machine first will turn employees into millionaires first.