- OpenAI sent shockwaves through the tech world Friday when its board ousted Sam Altman as CEO.
- The tech community is now scrambling to figure out what happened.
- Altman’s dismissal from OpenAI was abrupt and unconventional among big companies in Silicon Valley.
It’s been less than 24 hours since OpenAI announced that its high-profile CEO Sam Altman was fired because the board no longer had “confidence in his ability” to lead and that Altman was “not consistently candid in his communications.”
The news came as a shock to the tech world, including employees at OpenAI and Microsoft, which has invested about $13 billion into the ChatGPT maker.
But as a few new details of the ouster emerge, some have begun to describe it as a “coup,” or even a “hostile takeover,” journalist Kevin Roose said on a recent episode of Hard Fork, a New York Times podcast about tech.
Altman was pretty “popular” within the ranks of OpenAI, and recruited a number of its employees. So many of them were baffled by the news of his sudden departure, Roose said.
OpenAI’s now ex-president and cofounder, Greg Brockman — who quit in protest after Altman’s firing — said on X that Altman was given very little notice about his departure.
Sam and I are shocked and saddened by what the board did today.
Let us first say thank you to all the incredible people who we have worked with at OpenAI, our customers, our investors, and all of those who have been reaching out.
We too are still trying to figure out exactly…
— Greg Brockman (@gdb) November 18, 2023
In his X post, Brockman said on Thursday night, Altman received a text from Ilya Sutskever, OpenAI’s cofounder and chief scientist, asking to talk at noon the following day.
When Altman logged on to the Google Meet link on Friday, he was joined by the entirety of OpenAI’s board, Brockman said. Sutskever told Altman he was being fired and that they would publicize the news soon.
Minutes later, Brockman said he received a text from Sutskever asking to chat. Sutskever informed Brockman that Altman had been fired. And Brockman said he, too, was told that he was being removed from his role on OpenAI’s board but that he was still “vital” to the company and could remain as president. The company’s management team was made aware of the leadership changes shortly after that, Brockman said.
Mira Murati, who has now assumed the role of interim CEO, was informed of the executive shake-up on Thursday night, Brockman noted in his post.
“Sam and I are shocked and saddened by what the board did today,” Brockman said.
While the board’s actions are enigmatic by any account, it’s worth noting that OpenAI also operates by a rather unconventional corporate structure.
OpenAI launched in 2015 as a nonprofit. Then, in 2019, it announced a “capped profit” company, according to its website. So, it’s now made up of a nonprofit board that operates a for-profit entity, and most board members don’t own shares in the company. Altman, himself, took no equity in the company when it went for-profit.
OpenAI’s nonprofit board operates its for-profit entity. Screenshot from OpenAI’s website.
Altman’s departure has thrown Cerebral Valley, the moniker for San Francisco’s booming AI enclave, into a state of uncertainty.
Annie Wright, a psychotherapist in the Bay Area, who’s been observing the pulse of the area for years, said she, too, was shocked by the news in a text to Insider.
“AI makes the Bay feel like the Wild West in a gold rush and this feels analogous to the town Sheriff getting gunned down,” Wright said.
Source: I N S I D E R
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