AI lab equity is widening pay gaps as OpenAI and Anthropic near IPOs

In short: Employees at OpenAI and Anthropic are sitting on unusually large amounts of company stock, and it is widening the gap with other well paid tech workers.

What's going on

OpenAI and Anthropic are moving toward public listings, and new reporting says many employees have already built significant wealth from equity, meaning ownership in the company (like having slices of a pie that can grow in value). The New York Times reports that this is fueling frustration among other tech workers in places like San Francisco, even among people earning six figure salaries.

Several outlets have published details that help explain the gap. CNBC reported that OpenAI investor materials showed average stock based compensation of about $1.5 million per employee. Business Insider reported that both OpenAI and Anthropic have filed initial paperwork to go public, and that employees expect big windfalls.

The Information reported that employees at the two labs have already cashed out about $14 billion through earlier liquidity transactions, which are company approved chances to sell some shares before an IPO (similar to being allowed to sell part of your ticket before the main event). This suggests some employees have already turned “paper wealth” into real money.

What to watch

An IPO does not mean employees can sell everything right away. Many shares are restricted by lockup periods (a waiting time after the IPO) and vesting rules (earning shares over time), and taxes can take a significant cut. The final value will depend on the IPO price and what the stock does after it starts trading.

Source: NYTimes