Why a leading AI firm is warning people not to buy its stock

SAN FRANCISCO (KRON) — One of the biggest names in artificial intelligence is warning people not to invest in its stock. While that may seem counterintuitive behavior for a startup, in this case there is good reason for it.

Leading AI firm OpenAI is not a publicly traded company. However, in a blog post Tuesday, the San Francisco-based company is warning people to be aware of unauthorized and false promises to give investors access to equity in the company.

“All OpenAI equity is subject to transfer restrictions,” the blog post states. “This means that OpenAI equity cannot be directly or indirectly transferred unless the seller first obtains OpenAI’s written consent.”

“Any attempted transfer — which includes any pledge, encumbrance or other similar disposition — that does not follow this requirement is void,” the post continued.

The company went on to warn of firms advertising unauthorized opportunities to gain exposure to OpenAI equity through:

• Sales of OpenAI equity
• Investments in SPVs that own OpenAI equity
• Tokenized interests in OpenAI equity or an SPV holding Open AI equity
• “Forward” contracts and other forms of purported economic interests

“OpenAI does not endorse or participate in any of these transactions, which are a violation of our transfer restrictions that may result in the invalidation of the underlying equity,” the post continued.

OpenAI is among the hottest names in the nascent AI industry, which is largely centered in San Francisco. The buzz around the technology has been credited with fueling a tech boom in the markets.

Yet despite all the buzz and investor excitement around AI, the technology currently offers very little opportunity for investors. Leading AI firms like OpenAI and Anthropic, despite raking in millions from private investors, are not listed on publicly traded markets, leaving consumer investors clambering for opportunities.

This has apparently led to opportunists attempting to mislead investors.

“We urge you to be careful if you are contacted by a firm that purports to have access to OpenAI, including through the sale of an SPV interest with exposure to OpenAI equity,” the blog post warned.

“While not every offer of OpenAI equity (or exposure to it) is problematic, it is possible that the firm offering to sell or facilitate the sale of OpenAI equity, or to provide indirect exposure to OpenAI equity is attempting to circumvent our transfer restrictions and other terms and conditions applicable to an investment in OpenAI.”

If that is the case, the blog post says, the sale won’t be recognized and will carry no economic value to the investor. In addition to losing money, unauthorized transfers related to OpenAI equity may also violate federal and state securities laws — leading to potential liability for the buyer or seller.

“We intend to vigorously enforce the transfer restrictions applicable to any direct or indirect sales of our equity,” the post concluded.