[cma]

Not if the big holders aren't residents, they can move away just before like Rogan with his Spotify deal, or Jonathan Blow just before a game release after developing in California and going to public college there, etc.

Since it's a non-profit still holding it any gains to the non-profit entity upon the conversion don't go to California, and principal stakeholders can move away. Other funds raised from the IPO can be invested in other states untaxed (long term datacenter leases instead of booking the capital of building one) until they move the company away I think.

There will probably be a lot of smaller stakeholders that stay with a lot of money for the state, and California at least doesn't do the $15 million QSBS so they may get a lot from that tail of employees. A large portion of this tail of lower compensated employees may get laid off due to AI replacement before IPO and lose a lot of unvested years, if we are to believe OpenAI's own claims about timelines for job replacement in that field at lower levels.

[tedd4u]

I'd recommend anyone expecting to profit from OpenAI stock and aiming to avoid California taxes to look into the subject in depth with paid advisors. The California FTB is not stupid or naïve and has a history of successfully getting paid for stock that vested with a California nexus, even if the beneficiary moves out of state. Good luck!

[cma]

You're right, it's harder with vesting stock compensation than other things you build up over time like an audience or a developing a game over a long span.

[mlmonkey]

Take a look at Shohei Ohtani's contract.