December 6, 2023
OpenAI's board can't handle investors' anger. techcrunch

On Friday, the board of OpenAI, the AI ​​startup behind ChatGPIT and other viral AI-powered hits, did something unexpected, but seemingly within its rights: ousted the company’s CEO Sam Altman.

But given the way the situation has unfolded, it seems that OpenAI’s investors and partners – and many of its employees – were more comfortable with it. Idea He exercises that power as compared to the power of the board. And they didn’t trust the cult of personality around Altman, the former president of Y Combinator and a longtime fixture in the Silicon Valley startup scene.

On Saturday evening, just 24 hours after the OpenAI board informally announced that Altman would be replaced on a temporary basis by Mira Muratti, OpenAI’s CTO, multiple publications published reports that the OpenAI board was considering bringing Altman back to the helm. Was talking about. ,

What changed his mind? Undoubtedly, investors were angry and nervous – and rankled.

Satya Nadella, CEO of Microsoft, a major OpenAI partner, was reportedly “furious” to learn of Altman’s departure just minutes after it happened, and got in touch with Altman – and OpenAI supporters as well ( especially) promised to support them. Tiger Global, Sequoia Capital and Thrive Capital) seek Microsoft’s help to pressure the board to change direction. Meanwhile, some of OpenAI’s leading venture capital backers are said to be considering filing a lawsuit against the board; No one, including former OpenAI board member Reid Hoffman, co-founder of Khosla Ventures and LinkedIn, was given advance notice of the decision to fire Altman.

Vinod Khosla, founder of Khosla Ventures, said the fund wants to bring Altman back to OpenAI, but will support him in “whatever he does next”.

Microsoft in particular has a lot of leverage. According to Semaphore, OpenAI has received only a fraction of the company’s recent $10 billion investment, and a significant portion of the funding is in the form of cloud compute purchases rather than cash. Withholding those credits – and the remaining cash investment – ​​could leave OpenAI, which is starved for capital as the cost of running and training its AI systems continues to rise, in a financially untenable position.

As the board considers its next steps, OpenAI’s top AI researchers and executives are leaving.

On Friday, OpenAI president and co-founder Greg Brockman resigned after being removed as chairman by the board. Brockman was followed by three senior OpenAI researchers, including research director Jakub Pachocki and head of preparedness Alexander Madry. And more employees are reportedly handing in their resignations.

They see it as a power struggle with an unacceptable level of collateral damage between two board members in particular, Quora CEO Adam D’Angelo and Sutskever and Altman. Sutskever said during the company’s all-hands meeting on Friday that he felt it was “essential” to remove Altman to protect OpenAI’s mission of “making AI beneficial to humanity”, revealing that the company’s Altman’s business ambitions were beginning to irritate the kingmakers on the board. (OpenAI’s board is technically part of a nonprofit that controls OpenAI’s monetization strategy.)

But many in the tech community – and apparently OpenAI – felt the opposite. Eruption of high profile Help For Altman it was immediate.

And so, as Altman and Brockman approach investors about a new AI-chip-focused venture and OpenAI’s employee stock sale faces an uncertain future, the board of directors faces an uncomfortable situation. 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 Technology, may have felt that her decision to fire Altman was right and appropriate. But it seems like it wasn’t really their decision.

Case in point, The Verge reported late Saturday that the board had agreed in principle to resign — perhaps, making room for a Microsoft-aligned member — and allow Altman and Brockman to return. However, according to The Verge’s sources, Altman reportedly wants “significant” managerial changes upon returning; The Wall Street Journal reports that Altman told colleagues it was “ridiculous” that major shareholders had no role in OpenAI’s governance.

The board is in disarray and a number of OpenAI employees were set to leave the company after yesterday evening’s deadline was missed, The Verge reports. But its fate – and the fate of OpenAI’s architecture – would seem to be almost sealed.


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