What Is OpenAI? Everything You Need to Know

Key takeaways

OpenAI is an AI research company that offers a range of services, including ChatGPT, to develop AI in ways that they say benefit humanity. 

• OpenAI began its journey in 2015, and in 2018, it released the concept of a generative pre-trained transformer (GPT), followed by the release of ChatGPT in 2022.

• OpenAI offers several products that serve different functions, including ChatGPT for generating text and answers, Codex for generating code in different programming languages, and Whisper for speech recognition. 

• You can use OpenAI’s AI models to save time and money by automating tasks, as well as gain insights into your data through predictive analytics. 

Learn more about OpenAI, its history, and the benefits and drawbacks of its artificial intelligence products. If you want to learn more about how to make the most of ChatGPT, consider enrolling in Vanderbilt University's Prompt Engineering Specialization. You’ll have the opportunity to learn how to craft effective prompts in ChatGPT to automate tasks, increase productivity, plan complex processes, and more in as little as four weeks. Upon completion, you’ll have earned a career certificate for your resume.

What is OpenAI?

OpenAI is an artificial intelligence company and research lab that aims to develop AI and steer it in ways that “benefit all of humanity.” It was initially created as a non-profit organization due to its founders’ concerns about the potential misuse and catastrophe that could result from AI being used “in the wild.” Several investors pooled together $1 billion to deliver research and resources that remain open to the public.

Timeline and history of OpenAI

OpenAI was founded in 2015 with a focus on developing AI and machine learning tools for various activities. Its first offering was an open-source toolkit for developing reinforcement learning algorithms (OpenAI Gym), which prompted it to focus on AI research for more general purposes. 

In 2018, OpenAI released the concept of a generative pre-trained transformer (GPT), which is a neural network (a machine learning model) that simulates the human brain and is trained on data sets. In 2021, DALL-E was released, an image version of ChatGPT where humans can prompt the generative AI model to produce images. ChatGPT was released in November 2022 and became the most popular chatbot and generative AI tool for producing anything from chatbot responses to survey questions and resumes.

OpenAI continuously updates its large language models (LLMs) to improve their performance. As of December 2025, the company offers a wide range of GPT models, including (but not limited to) [1]:

• GPT-4.5: This model is currently a research preview that is OpenAI's largest model to date. The organization claims it excels at tasks involving creativity and open-ended thinking.

• GPT-4o: OpenAI's flagship model, capable of performing complex tasks requiring multiple steps.

• GPT-4o mini: A smaller and more affordable version of GPT-4o that's meant for speedy, low-lift tasks.

• o1-preview and o1-mini: Models specially trained with reinforcement learning that can perform more complex reasoning tasks.

• GPT-4 Turbo and GPT-4: OpenAI's former flagship models are equipped with more general knowledge and reasoning abilities than previous models.

• GPT-3.5 Turbo: A relatively inexpensive model used for straightforward, simple tasks.

Who owns OpenAI?

OpenAI has a nonprofit ownership structure (but is now a for-profit business). It was originally founded by research engineers and scientists, with large donations from entrepreneurs such as Elon Musk (Tesla, SpaceX), Sam Altman (OpenAI's current CEO), Reid Hoffman (LinkedIn co-founder), Peter Thiel (PayPal co-founder), and several others.

Today, Microsoft is one of the largest stakeholders and backers of the company. However, some investors are still involved, except most notably Musk, who left in 2018 and later started his own AI company, xAI.

OpenAI products and releases

Large language models can be used for a wide range of tasks, from creating text to generating videos and even transcribing audio files. As a result, OpenAI has quite a few product offerings, such as the following:

• ChatGPT: An AI chatbot that generates text and answers to user prompts and questions. It is trained on large data sets and simulates the experience of speaking with and listening to a human. 

• DALL-E 3: This is a platform that analyzes descriptions and prompts of images that users want and generates them as described. For example, “paint a cat in Surrealist style.”

• Codex: Codex is like ChatGPT but for code. It’s trained on tons of code in different programming languages to simplify the coding process for developers [2].

• Whisper: Whisper is an automatic speech recognition tool that’s trained on audio data in dozens of languages so that it can transcribe and translate speech.

• Scholar: A program that supports researchers and students on AI-related projects, and sometimes provides financial assistance.

• OpenAI Gymnasium: Gym is a toolkit that provides a foundation for developing reinforcement learning algorithms.

• OpenAI API: The OpenAI API provides an interface for you to connect OpenAI’s AI models with your own applications.

Read more: How To Write ChatGPT Prompts

Guided Project: OpenAI for Beginners

Learn how to programmatically prompt an OpenAI model using the OpenAI API and use the AI to add to a data set on a user's movie collection. With the OpenAI model, you’ll be able to input data such as genre, director, and movie plots. Flex your skills so you can add this project to your growing portfolio in just two hours.

Benefits and drawbacks of OpenAI products and services

Generative AI is leading-edge technology that offers a host of benefits and potential dangers for consumers and organizations alike. As a result, OpenAI has faced both praise and criticism from the public and technology professionals. Here’s a breakdown of some of the benefits and drawbacks of OpenAI products.

Benefits

OpenAI products such as ChatGPT, when used correctly, can help us in our daily professional lives to perform certain AI-driven tasks with accuracy and efficiency.

• Save time: Machine learning algorithms can automate tasks, such as text, image, and voice recognition, which can save users a lot of time. The everyday user can use the time to focus on editing survey questions rather than devising 20 original ones. Software developers can focus on making the mobile app functional.

• Save money: OpenAI can save companies money on labor, since manually tagging photos uploaded by users (on Facebook, for example) would require a huge team.

• Gain insights: OpenAI’s predictive analytics can analyze large data sets and deliver insights that can be used to foster engagement with a product or service. It can identify patterns in user behavior to transform a good product or service into a great one [3].

Drawbacks and criticism

The drawbacks of OpenAI involve criticisms that apply to all types of AI and its implications on humanity unless they consider ethics and bias.

• Is it ethical? OpenAI has received criticism for shifting from its “nonprofit” status in 2019. This led people to believe that OpenAI was participating in the race toward developing the most advanced technology based on research it had gathered as a non-profit and using it to reap profits. 

• Is it accurate? OpenAI’s products, such as ChatGPT, have received criticism that they are trained on news and data from the open web that might be outdated or worse, biased. Its ability to separate fact from fiction from stereotypes is worth considering.

• Is it safe? Toxic content has already surfaced in OpenAI’s services, including how to construct a bomb and how to steal from unsuspecting individuals.

• Is it legal? The risks of OpenAI’s services have reached the federal government level, where officials are filing lawsuits regarding the legality of sourcing data and copyrighted materials. Actions have been taken to protect authors’ and artists’ original work.

Resources to help keep you on track

Ready to keep exploring? Discover the latest trends and in-demand skills in your industry by subscribing to our LinkedIn newsletter, Career Chat! Or if you want to keep learning more about AI and genAI, check out these free resources:

• Take the quiz: AI Career Quiz: Is It Right for You? Find Your Role

• Watch on YouTube: How Does GenAI Work? | Generative AI 101 

• Hear from an expert: How to Use GenAI in Your Job: Insight from Coursera’s Former CEO 

Whether you want to develop a new skill, get comfortable with an in-demand technology, or advance your abilities, keep growing with a Coursera Plus subscription. You’ll get access to over 10,000 flexible courses.