19th November 2023 – (Hong Kong) Investors of OpenAI, including Microsoft and prominent venture capital firms, are reportedly working to remove the company’s board and reinstate Sam Altman as the chief executive officer of the generative AI start-up. According to individuals familiar with the matter, the investors, along with employees at OpenAI, are exploring options to address the crisis that unfolded after Altman was pushed out of ChatGPT and co-founder Greg Brockman resigned, causing shockwaves in Silicon Valley.
Among the options being considered is the removal of the board overseeing OpenAI, which is a non-profit organization, and the reinstatement of Altman and Brockman. Discussions have taken place between major investors in OpenAI, such as Thrive Capital, Tiger Global, and Sequoia Capital, and Microsoft, as well as with Altman himself, to explore potential paths forward.
One leading investor is confident that the board can be removed and Altman and Brockman reinstated before the weekend concludes. Investors hope that Altman will return to a company that has been his life’s work, while Mira Murati, who was promoted from chief technology officer to interim CEO, would remain at the company, according to the investor.
However, other venture funds are hedging their bets and expressing support for Altman regardless of whether he returns to OpenAI or starts a new venture. Vinod Khosla, an early venture backer of OpenAI, stated that he wants to see Altman back at OpenAI but will back him in whatever he chooses to do next.
Microsoft, Thrive Capital, Tiger Global, and Sequoia declined to comment on the situation, and OpenAI could not be immediately reached for comment.
The board cited Altman’s lack of consistent candor in their conversations as the reason for his removal on Friday. Investors and employees have the option to withdraw further support or leave the company in an attempt to pressure the board into reinstating Altman. Additionally, a plan to sell up to $1 billion in employee stock, which was nearing completion, is now uncertain due to the division between the board and investors. Thrive Capital was expected to lead the tender offer, which would have valued OpenAI at $86 billion.
The sudden decision by the OpenAI board to oust Altman and demote Brockman has drawn attention to the company’s unique corporate structure and governance. The board oversees a non-profit entity that owns a for-profit company. Unlike a typical for-profit organization, where fiduciary duties are owed to shareholders, OpenAI’s board is committed to a charter that prioritizes the development of AI for the benefit of humanity.
The board, which includes OpenAI’s chief scientist Ilya Sutskever and independent directors Adam D’Angelo, Tasha McCauley, and Helen Toner, has not publicly disclosed the specific reasons for the split with Altman beyond their statement on Friday. Investors suggest that tensions over the pace at which Altman wanted to deploy powerful AI tools contributed to the board’s concerns about compromising the safety of those tools.