OpenAI in turmoil after big changes

OpenAI scoop: In an email to investors, OpenAI’s CFO says funding round should close by next week despite exec departures... looks to reassure backers that the startup is still in a strong position as it loses top talent. Says the round is oversubscribed. Latest for CNBC: https://lnkd.in/gXg5UwXb

Whenever there is turmoil at OpenAI, all eyes turn to Anthropic, the favorite underdog. Could they capitalize on their rival’s missteps? Founded in 2021 by OpenAI veterans, Dario (formerly VP of Research at OpenAI) and Daniela Amodei (formerly VP of Safety & Policy at OpenAI), Anthropic set out to tackle AI safety head-on and has since navigated the competitive landscape masterfully to establish itself as a credible contender.?Claude 3.5 launched this summer to very positive feedback - outperforming GPT 4o in many instances. What’s even more impressive is that they’ve done it with less capital and less time. Their product vision is sharp, and in contrast to OpenAI’s chaos, they exude stability. But let's not rush to crown a new king because in markets trending towards commoditization, the game is won on distribution. OpenAI has entrenched itself in 2 of the 4 major consumer ecosystems: Microsoft and Apple. The other 2—Google and Meta—are pushing their own AI agendas. Anthropic’s deep partnership with Amazon is significant but remains cloud-bound, lacking direct consumer touchpoints. It’s betting on developers to bring its capabilities to life. OpenAI, on the other hand, is running a penetration play at scale on two of the world's largest installed base of consumers. Then there’s another nuance: mindshare. ‘ChatGPT’ is practically shorthand for generative AI. It’s part of the cultural lexicon. Anthropic has built a great product, but OpenAI has achieved what every company dreams of—it’s become the Kleenex of its category. So while Anthropic’s clarity of purpose is appealing, OpenAI’s distribution muscle and cultural imprint still make it a force that’s hard to topple.?Game of Models >> Game of Thrones. ??

At an all-hands meeting Thursday, OpenAI CEO Sam Altman denied that there are plans for him to receive a “giant equity stake” in the company, calling that information “just not true,” according to a person who was in attendance. Altman and finance chief Sarah Friar both said at the meeting, conducted by video, that investors have raised concerns about Altman not having equity in the high-valued artificial intelligence company that he co-founded almost nine years ago, said the person, who asked not to be named because the gathering was only for employees. Regarding his potentially attaining an equity stake, Altman said, “There are no current plans here,” the person said. OpenAI Chairman Bret Taylor told CNBC in a statement that while the board has talked about the matter, no specific figures are on the table. (CNBC)

New from me: In less than two years, OpenAI has gone from little-known research lab to one of the most famous companies in the world and a symbol of the AI revolution. Those changes are tearing the company apart. Some internal tensions are related to conflicts between OpenAI’s original mission and new initiatives to make moneymaking products. There’s also chaos and infighting among executives worthy of a soap opera. More here, with a gift link: https://lnkd.in/gvNTR5uE

??My thoughts on the recent leadership departures at OpenAI. As a venture investor, I've seen time and again how the departure of key team members, even in mature projects, can send ripples through a company. When they catch the team members off guard, it's even more shocking to those not directly involved with the company. But these situations don't always spell disaster. With the right approach, they can be managed and even turned into opportunities for growth or course correction. In OpenAI's situation, the leadership crisis isn't entirely unexpected. We saw similar tensions last year with the ouster of CEO Sam Altman, and more recently with the departure of co-founder and chief scientist Ilya Sutskever. The company has survived both with little damage. The role of investors is to evaluate the potential impact of such crises and determine whether the company can stay on course. As an investor, my key question is always: Can the team, post-transition, continue to deliver on its promises? For company leaders, the most important thing during a crisis like this is to ensure that the team stays focused on long-term objectives. In OpenAI's case, I'm pretty confident that Sam Altman and his team have the resilience to get through this crisis and move forward. The bottom line is that while exits of strong C-level leaders are rarely easy, they don't have to be catastrophic. With the right approach, companies can emerge even stronger.

Imagine you’re a shareholder at OpenAI. If Sam Altman, the CEO, were to receive a large equity stake—which means a significant share of ownership—it could impact your stake in the company. How? Well, equity dilution might reduce your percentage of ownership. But here’s the flip side: if Altman’s financial success is tied to OpenAI’s, it could boost investor confidence. That could mean an increase in OpenAI’s market valuation and long-term growth. Sounds like a potential win, right? Now, what if you’re a user of OpenAI’s products, like ChatGPT? If Altman had a vested interest in the company’s success, it could translate into leadership stability. That’s good news for users because stable leadership often means continued innovation and improvements, which would enhance your overall experience. Although Altman has denied any immediate plans for a large equity stake, if it ever happens, it could secure OpenAI’s future as a leading force in the AI industry, benefiting both shareholders and users in the long run. What do you think about that? -Dr.Koay- #AI #ArtificialIntelligence #OpenAI #AIGrowth #AIInnovation #AILeadership #TechLeadership #AIValuation #AIInvestments #AIProducts #AIImpact #ChatGPT #AIUsers #TechGrowth #AIEquity #AIIndustry #AIFuture #AIForBusiness #AITransformation #AIDevelopment

Looks like Sam Altman’s company is shaking off the do-gooder shackles. OpenAI's founding mission statement read, “OpenAI is a non-profit artificial intelligence research company. Our goal is to advance digital intelligence in the way that is most likely to benefit humanity as a whole, unconstrained by a need to generate financial return. Since our research is free from financial obligations, we can better focus on a positive human impact.” Tech columnist Dave Lee did some light editing of OpenAI’s (now quite out of date)?founding mission statement in his latest column. Dave wrote: “OpenAI is an artificial intelligence research company. Our goal is to advance digital intelligence to generate financial return.” ??That is much clearer and far more accurate. Read why on Bloomberg Opinion:?https://lnkd.in/exQ2YQ3v

OpenAI is a trainwreck (or is it??) Gary Marcus, AI's favorite hater, is pointing to CTO Mira Murati's departure as an indicator of OpenAI being a trainwreck. He even compared the company to Theranos and FTX. ?? I think we're getting over our skis here. Sure, OpenAI may not be perfect (name me a startup that is). But this feels to me like a natural progression of things. Watch the vid below to see my take (from San Francisco today!) ?? (Getting used to these darn hills ???? ) What do you think? Is OpenAI the next Theranos or FTX? Or is this unjust criticism? -- If I'm new to your feed, hello! I'm Lauren "??" Vriens - startup advisor and AI product strategist. My videos on AI have gotten 7M impressions over the last 30 days - but my sister is still not impressed. Help me impress her by hitting the follower button. ?? ?? -- #openai #miramurati