On Friday, the board of OpenAI, the AI startup behind ChatGPT and other AI-based viral hits, did something unexpected but seemingly entirely within its rights: deleted the company’s CEO, Sam Altman.
But judging from how the situation developed, it seemed that OpenAI’s investors and partners – as well as many of its employees – were more comfortable with the situation. idea of the power of the council that it does not exercise this power. And that was without counting on the cult of personality that surrounds Altman, former president of Y Combinator and long-time regular on the Silicon Valley startup scene.
On Saturday evening, just over 24 hours after OpenAI’s board of directors unceremoniously announced that Altman would be replaced by Mira Murati, OpenAI’s CTO, on a temporary basis, several publications published reports suggesting that OpenAI’s board was in talks for Altman to return to the helm.
What made them change their minds? The anger and panic of investors, no doubt – and angry ranks.
Satya Nadella, the CEO of Microsoft, a major OpenAI partnerwas would have “furious” to learn of Altman’s departure”minutes” after this happened, and was in contact with Altman – and committed to supporting him – as a supporter of OpenAI (in particular Tiger Global, Sequoia Capital and Thrive Capital) recruit Microsoft’s help in pressuring the board to change course. Meanwhile, some of OpenAI’s major venture capital backers are reportedly considering taking legal action against the board; none, including Khosla Ventures and LinkedIn co-founder Reid Hoffman, a former OpenAI board member, were informed in advance of the decision to fire Altman.
Khosla Ventures founder Vinod Khosla said the fund wanted Altman to return to OpenAI but would support him in “whatever he does next.”
Microsoft, in particular, has many means of pressure. OpenAI only received a fraction of the company’s recent $10 billion investment, according to Semafor, and a significant portion of the funding comes in the form of cloud computing purchases rather than cash. Withholding these credits – and the rest of the cash investment – could leave OpenAI, hungry for capital as the costs of operating and training its AI systems rise, in an untenable financial position.
As the board considers its next move, OpenAI’s top AI researchers and executives are calling for resignations.
On Friday, Greg Brockman, president and co-founder of OpenAI, resigned after the board of directors removed him as chairman. Three senior OpenAI researchers left after Brockman, including director of research Jakub Pachocki and chief preparation officer Aleksander Madry. And more and more employees are would have submit their resignation.
They perceive it as a power struggle with unacceptable levels of collateral damage between two board members in particular, Quora CEO Adam D’Angelo and Sutskever, and Altman. Sutskever told a company plenary meeting Friday that he believed Altman’s removal was “necessary” to protect OpenAI’s mission to “make AI beneficial to humanity,” suggesting that Altman’s business ambitions for the company were beginning to unsettle the kingmakers on the board of directors. (The OpenAI Board of Directors is technically part of a nonprofit organization that governs OpenAI’s monetization strategy.)
And so, as Altman and Brockman say approach investors about new AI chip-focused company and OpenAI sale of employee shares Faced with an uncertain future, the board of directors faces an uncomfortable about-face. Sutskever and the rest of the board – tech entrepreneur Tasha McCauley; and Helen Toner, director of strategy at Georgetown University’s Center for Security and Emerging Technologies, might have thought their decision to fire Altman was fair and justified. But it seems like it wasn’t really their decision to make.
Case in point, The Verge reported Saturday evening, the board of directors had agreed in principle to resign… manufacturing bedroom, perhaps, for a Microsoft-aligned member – and to allow Altman and Brockman to return. Altman is said to be “ambivalent” about returning and would however like “significant” management changes, according to The Verge’s sources; The Wall Street Journal reports that Altman told his associates that it was “ridiculous” that major shareholders had no say in the governance of OpenAI.
The board has since remained confused, failing to meet a deadline last night for many OpenAI staff members to leave the company, The Verge reports. But its fate – and that of OpenAI’s structure – seems all but sealed.