Nearly all OpenAI staff threaten to go to Microsoft unless board quits, as investors try to bring back Altman

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Microsoft chief executive officer Satya Nadella and other investors spent Saturday and Sunday trying to get Altman and former OpenAI president Greg Brockman rehired. On Sunday night, OpenAI interim CEO Mira Murati told a board member she planned to bring them back, but the directors decided instead to name former Twitch chief Emmett Shear as CEO, bypassing Murati and the investors.

Not long afterward, Microsoft, OpenAI’s biggest investor by far, said it was hiring Altman, Brockman and unnamed “colleagues” to a new artificial intelligence unit that Altman would run as CEO.

Now, it turns out, Microsoft would be amenable to Altman and Brockman returning to OpenAI – albeit with a couple of key conditions. The start-up’s current board would have to resign, and OpenAI’s governance would have to change to ensure that such upheaval could never happen again, according to people familiar with the software giant’s thinking.

“Irrespective of where Sam is, he’s working with Microsoft,” Nadella said in an interview with Bloomberg Television on Monday.

Microsoft’s key goal is to ensure continued access to leading-edge AI technology for customers and partners, the people said. The company may consider asking for an increased role on OpenAI’s board, they added. Though Microsoft previously feared doing so would anger regulators, the company now believes stabilising its partnership with OpenAI far outweighs the regulatory risks.

Investors led by Thrive Capital have been planning to offer to buy shares from OpenAI employees, through what is known as a tender, a deal that would value the company at US$86 billion.

Despite the turmoil at OpenAI, Thrive, which is leading the offer, is pressing ahead with its plans, assuming it can lure Altman back to OpenAI, according to a person with knowledge of the matter. The money has not been wired yet, and if Altman does not return, it could jeopardise those plans.

Tiger Global, Microsoft, OpenAI and Thrive declined to comment.

Sam Altman, left, appeared onstage with Microsoft CEO Satya Nadella earlier this month at OpenAI’s first developer conference. Photo: AP Photo

The chaos inside OpenAI could reshape the world of artificial intelligence.

OpenAI kicked off the global frenzy around generative AI with the launch of its hugely popular chatbot ChatGPT a year ago. With Altman as its figurehead, OpenAI was at the centre of the tech industry’s efforts to deploy this technology to businesses and consumers – and also to work with regulators on guardrails for AI.

But the tension at OpenAI raises new questions about whether AI start-ups can balance developing AI responsibly alongside the need to raise vast amounts of capital from investors to support the expensive computing infrastructure required to build these tools.

OpenAI’s turmoil could also set off a race by other tech companies to poach highly-competitive AI talent. Salesforce chief executive officer Marc Benioff offered on Monday to immediately employ researchers resigning their posts at OpenAI. Salesforce will provide matching compensation to any researcher who has quit OpenAI, Benioff said in a post on X.

Among the many employees and executives who signed the letter were Murati, OpenAI’s chief technology officer who had been named interim CEO on Friday, and Ilya Sutskever, an OpenAI co-founder and board member who has been seen as instrumental in the board’s actions. (Wired previously reported on the employee letter.)

“I deeply regret my participation in the board’s actions,” Sutskever wrote in a post on X, formerly Twitter, on Monday. “I never intended to harm OpenAI. I love everything we’ve built together and I will do everything I can to reunite the company.”

Several Chinese experts back call by Musk and others for pause in AI race

Altman clashed with members of his board, especially Sutskever, the company’s chief scientist, over how quickly to develop generative AI, how to commercialise products and the steps needed to lessen their potential harms to the public, people with knowledge of the matter have said.

OpenAI’s other board members included Adam D’Angelo, the co-founder and CEO of Quora; Tasha McCauley, CEO of GeoSim Systems; and Helen Toner, director of strategy and foundational research grants at Georgetown’s Centre for Security and Emerging Technology.

Alongside rifts over strategy, board members also contended with Altman’s entrepreneurial ambitions.

Altman was also courting SoftBank Group chairman Masayoshi Son for a multibillion-dollar investment in a new business to make AI-oriented hardware in partnership with former Apple designer Jony Ive.

Ousted OpenAI CEO sought billions in Middle East for chip venture

Altman’s ousting from the company he co-founded also leaves OpenAI and its employees with some immediate unknowns.

Some investors were considering writing down the value of their OpenAI holdings to zero, according to a person familiar with the discussions. The potential move, which would make it more difficult for the company to raise additional funds, seemed designed to pressure the board to resign and bring Altman back.

Also in the balance was a second tender planned for early 2024 which would have given early stage investors a chance to get some liquidity on their shares, the people said.

As recently as last week, blocks of OpenAI’s private shares were being offered that valued OpenAI in excess of US$100 billion. That market dried up on Friday after news broke that Altman had been dismissed by the board, leaving hundreds of millions of dollars of private transactions pending.

Altman’s firing came as a surprise to OpenAI’s workers, the letter said, as well as to Microsoft.

Emmett Shear, founder and former CEO of Twitch. Photo: Getty Images/AFP

Late Sunday, the company’s four-person board instead appointed Shear, co-founder and former CEO of game-streaming website Twitch.

Shear, who became OpenAI’s second interim chief executive in three days, won over the directors because of his past recognition of the threats that AI presents, a person familiar with the matter said, asking to remain anonymous to discuss the private deliberations.

Shear is a well-regarded technologist and computer scientist who has long advocated a more cautious approach to AI.

He set out the priorities for his first 30 days in charge in a post on X, promising to reform the leadership team and hire an independent investigator to look into the circumstances of Altman’s termination. That was apparently not enough to assuage employees from issuing their board ultimatum.

Shear did not immediately respond to a request for comment.

Ahead of the letter’s release, many employees from OpenAI posted identical messages on X: “OpenAI is nothing without its people.” Altman responded to several of them with a heart emojis.

“We have more unity and commitment and focus than ever before,” Altman wrote on X Monday. “We are all going to work together some way or other, and I’m so excited. One team, one mission.”

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