What REALLY Happened At OpenAI...

We are seriously witnessing the craziest Silicon Valley soap opera we've ever seen. This OpenAI saga is just blowing everybody's minds right now. And the plot keeps on thickening. More and more keeps happening. I made a quick reaction video yesterday when I heard the news about Sam Altman getting fired. And then after that, just a snowball of announcements came out. And so I wanted to make another quick video. I'm not going to do a whole bunch of polished editing on this one. I just want to get get the facts out there and sort of break down everything we know. But before we get into it, here's the quick tldr. This has been mind blowing. So Sam Altman fired from OpenAI yesterday. Sam Altman goes to Twitter to confirm that he was fired from OpenAI a few hours later, Greg Brockman tweets he quits. Greg then tweets a breakdown of the events and how rapidly this timeline escalated. Sam Altman then shares a couple of cryptic tweets. Tweets not really giving any insights into what's going on. Later that night, three more senior OpenAI researchers resign from OpenAI. We learned that Microsoft was completely blindsided by the whole thing. They did not see it coming either. More information comes out that sort of confirms that Ilya Suskever was the person behind this coup to oust Sam Altman. And then today, right before I started recording this video, we learned that OpenAI is trying to get Sam Altman back as CEO. Like, what the heck is going on going on here? So let's just go ahead and slightly less quickly break down the series of events as well as some of the speculation that's out there about what's going on. Now, please keep in mind these are real human beings. These are real people. These are their lives, their careers. And a lot of what is in this video will be speculation. Most of it is facts, but some of it is speculation. And until the actual OpenAI board and SAM Altman make more official announcements, none of us truly know what's going on here. But with that being said, let's get into what we actually do know about this whole situation. So we covered this pretty well in yesterday's video. OpenAI made an announcement that a leadership change was needed and Sam Altman was out and Mira Muradi was in as new CEO. The reasons that OpenAI gave were very cryptic, but they said he was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities. The board no longer has confidence in his ability to continue leading OpenAI. We also learned in this message that Greg Brockman had essentially actually been demoted, stepping down as chairman of the board, but would remain in his role at the company, reporting to the CEO. Not long after that post was put out, Sam essentially confirmed, saying, I loved my time at OpenAI. It was transformative for me personally and hopefully the world a little bit. Most of all, I loved working with such talented people. We'll have more to say about what's next later. This was at 1:46pm on November 17th. Just a little bit over two hours later, Greg Brockman went to Twitter to announce he's done, he said after learning today's news, this is the message I sent to the OpenAI team. Hi everyone. I'm super proud of what we've all built together since starting in my apartment eight years ago. We've been through tough and great times together, accomplishing so much despite all the reasons that should have been impossible. But based on today's news, I quit genuinely wishing you all nothing but the best. I continue to believe in the mission of creating safe AGI that benefits all of humanity. Again, this was at 4:09pm Greg later came back to Twitter about four and a half hours later to break down the series of events as they happen, he said, 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 what happened, but here's what we know. Last night Sam got a text from Ilya asking to talk. At noon on Friday, Sam joined a Google Meet and the whole board except Greg was there. Ilya told Sam he was being fired and that the news was going out very soon. I'm not quite sure why Greg is speaking in the third person here. Somebody else might have written this and he copied and pasted it, but Greg is talking about himself in the third person. At 12:19pm, Greg got a text from Ilya asking for a quick call. At 12:23pm, Ilya sent a Google Meet link. Greg was told that he was being removed from the board but was vital to the company and retain his role and that Sam had been fired. Around the same time OpenAI published their blog post. As far as we know, the management team was made aware aware of this shortly after. Other than Mera who found out the night prior, the outpouring of support has been really nice. Thank you, but please don't spend any time being concerned. We will be fine. Greater things coming soon. Not too long after that, we finally heard again from Sam Altman. He says, I love you all. Today was a weird experience in many ways, but one unexpected one is that it has been sort of like reading your own eulogy while you're still alive. The outpouring of love is awesome. One takeaway. Go tell your friends how great you think they are. And there's been some fun conspiracy theories floating around. I love you all. I L Y A Ilya but we'll get to that in a minute. About a half hour later, Sam went back to Twitter to say, if I start going off, the OpenAI board should go after me for the full value of my shares. Now if you're not familiar, Sam Altman doesn't own equity in OpenAI. In fact, I don't believe anybody on the board owns equity in OpenAI. You make a lot of money, do you? I make no. I paid enough for health insurance. I have no equity in OpenAI. Really? That's interesting. You need a lawyer or an agent. I'm doing this because I love it. So with that additional context that makes this tweet that much more funny. So after the revelation that Sam Altman had been fired and then Greg Brockman subsequently quit, three more senior OpenAI researchers then resigned. Jacob Pachocki, the company's director of research Alexandra Madri, head of head of the team evaluating potential risks from AI and Simon Sidor, a seven year researcher at the startup, told associates they had resigned this article, claiming that it's a sign of immense disappointment among some employees after the Altman ouster. And to top all of that off, to make matters Even worse for OpenAI, Microsoft claims that they were completely blindsided by the decision. According to this article, Microsoft, which has invested billions in OpenAI, learned that OpenAI was ousting CEO Sam Altman just a minute before the news was shared with the world. Satya Nadella from Microsoft himself had a ra cold statement about the whole ordeal, saying, we have a long term agreement with OpenAI with full access to everything we need to deliver on our innovation agenda and an exciting product roadmap and remain committed to our partnership and to Mirror and the team. And since then Microsoft hasn't really made any other statements. But one could only imagine that Microsoft is not happy with not being consulted before this decision happened. Now one final thing to note before I start getting into the speculation is that yes, the board voted to boot out Sam Altman. But keep in mind that the board is just six seats total. The board consisted of Greg Brockman, who was chairman and president, Chief Scientist, ilya Suskever and CEO Sam Altman. There's also three non OpenAI employee board members, Adam D', Angelo, Tasha McCauley and Helen Toner. Now we know for a fact that Greg Brockman and Sam Altman weren't in on this decision and they needed four votes to oust Sam Altman, meaning that Ilya, one of the original co founders who co founded it with Sam and Greg, was one of the people who in fact voted to remove Sam. With much of the speculation leaning towards Ilya sort of masterminding the push out of Sam. So I just want to put this whole thing in perspective. Yesterday I made a video. I was very passionate in it. I was just blown away. I was shocked. All of this information coming out just blew my mind. I could not understand why OpenAI would push out Sam Altman. And the reasons being Sam Altman almost single handedly brought this company to an 80 plus billion dollar valuation. Sam was likely integral in the relationship that OpenAI and Microsoft now have with each other. And it was under Sam's leadership that they managed to get this company to over 100 million active users. That was all pretty much under Sam's leadership when they hit all of those milestones and became one of the largest, fastest growing unicorn companies in Silicon Valley at the height at the peak of this company just continuing to explode. I mean, their dev day seemingly was a huge success from an outsider standpoint. After all of that, they decided this guy who got us here needs to go. And that to me just makes no sense. Now. Over the past 24 hours I've sort of been obsessed with this story, probably to a fault, but I've been going down the rabbit hole. I was on a three hour Twitter space where we didn't talk about anything but this scenario. We played out every possible theory you can imagine of why this was happening. And I've sort of came to my own conclusions of what I think is actually happening with OpenAI and why they wanted Sam out. But of course I didn't sort of come to this conclusion myself. I came to it by reading a handful of articles and a handful of Twitter threads that really made sense to me. So I want to share with you what I came across that makes the most sense to me about why all of this is happening. I think this thread from Jeremy Howard is probably the most logical explanation that makes sense to me now. I don't agree with everything Jeremy is saying here, including the fact that he thought that Dev Day was an absolute embarrassment. That to me is sort of unfounded. But his explanation does kind of make sense if you put yourself in somebody like Ilya's shoes, who is a scientific academic researcher who's not that excited by all of the commercial uses of this AI, but more excited about the actual research. Well, if you look at it from that perspective, then maybe the Dev Day was a bit of a disappointment. So let's read through his Twitter thread here because I think it'll all make sense and I really think that his points feel like the most logical conclusion to me. So he starts off by talking about Dev Day here and how he found it very disappointing. The plan was AGI lifting society to a new level. Instead we got laundry buddy when OpenAI was founded, I felt like it was going to be a rough ride. It was created by a bunch of brilliant researchers that I knew and respected, plus some interesting huge names from outside the field. Elon, Greg Brockman, Sam Altman. None who I'd ever come across in any AI or machine learning conference or meetup. Everything I'd heard about those three was that they were brilliant operators and that they did amazing work. But it felt likely to be a huge culture shock on all sides. But the company absolutely blossomed nonetheless. With the release of Codex, however, we had the first culture clash that was beyond saving. Those who really believed in the Safety mission were horrified that OpenAI was releasing a powerful, large language model that they weren't 100% sure was safe. At that point, the company split and Anthropic was born, one of the original co founders going on to found anthropic. Now, OpenAI accelerated in its new direction. It wasn't open anymore, and it decided to pursue profits to fund its nonprofit goals. Nonetheless, the company remained controlled by the nonprofit and therefore by its board. Suddenly, Sam Altman, the CEO, was everywhere, giving keynotes, talking to world leaders, and raising billions of dol. He's widely regarded as one of the most ambitious and effective operators in the world. I wondered how his ambition could gel with the legally binding mission. My guess is that watching the keynote would have made the mismatch between OpenAI's mission and the reality of its current focus impossible to ignore. I'm sure I wasn't the only one that cringed during it. Now he's talking about Dev Day again. I think the mismatch between mission and reality was impossible to fix. Overall, I expect that OpenAI's board's move will turn out to be A critical enabler of OpenAI's ability to deliver on its mission. The future, future aspirational people looking for power and profits will not be drawn to the company, and instead it'll hire and retain its true believer. And that's pretty much the end of the thread there. But essentially what he's saying is that you've got the side of Ilya and the researchers that are developing AI, they're trying to get to AGI, they're trying to advance humanity and build something that truly makes a difference. And then on the other side, you've got Sam Altman and you've got Greg Brockman, and they're more on the enterprising side, they're more on the commercial side. How do we get more users of this product? How do we make it more useful for the general public? How do we make things like Laundry buddy that could be mildly beneficial to people? And these two philosophies were sort of at odds with each other. I would imagine that people like Ilya and the more scientific, academic side of the company weren't super excited about things like being able to build your own GPTs and then sell them in a GPT store. In fact, they probably weren't even that excited about the fact that Microsoft is over here rolling out all of this OpenAI tech into Microsoft products as fast as OpenAI can create it. Right? The academic side was not a huge fan of that. But Sam Altman, being a VC guy, a guy that came from Y Combinator, being good at pitching and making deals and rallying the troops behind him, is out here showing the world what you can do with it and why everybody should have access to it and why everybody should be using these tools now on the same sort of token, it's also a security versus rapid growth conversation, right? People like Ilya and the academics want to make sure that the security, the privacy, all of these implications over on this side are really being thought through. Ilya was essentially mentored by Geoffrey Hinton, who left Google because he was worried about the risks of AI. It wouldn't be hard to believe that Ilya has very similar beliefs around the risks of it and wants to slow things down and build it in a slow but secure way. Where Sam Altman is on the side of let's get it out to the world, let's let the world use it, test it, move fast and break things, and we will create something better as the world gets access and finds the flaws in it. Those philosophies were so opposing that, I believe, and I'm kind of thinking this is what Jeremy Howard is also saying in his tweet thread. That is the reason Sam was pushed out. Now here's another explanation from Andrew Kuti along similar lines. He says this is his highliest likelihood explanation on Altman's debut departure. Now I'm not going to read this word for word, but he's saying here the likely factions were Ilya, Sam, Greg versus Adam, Tasha and Helen. Firing Sam was politics. It was not over performance, strategic leadership or vision for the company. Rather there was contention over the use of a breakthrough that drove a vote between safety ism and deployment speed. So what was the wedge issue? Just recently at apec, Sam announced he had witnessed the frontier of knowledge being pushed back four times in his experience at OpenAI and the last time was recently a couple weeks ago. Likely Greg and Sam wanted to build and deploy it in earnest and Ilya didn't. Ilya had become lead of the Super Intelligence Alignment Division earlier this year. I would bet Ilya was the vote that broke the stalemate and led to the departure. Sam was kicked out over concerns he would move AI forward too fast by deploying this recent breakthrough. He goes on to say it's unlikely departure was related to anything regarding operations, cash burn, partnership making ability and so forth. OpenAI basically has a blank check status for ability to raise. They have huge cash flow, only a few hundred staff and are beyond doubt out. Likely the board felt that OpenAI was completely set up in partnerships, funding team and direction. They could afford to push Sam out to regain control of the direction and the pace of rollout of AI tools without threatening the security of OpenAI. Ultimately this is a split between safetyism and acceleration. Sam being on the acceleration side, Ilya being on the safety ISM side. The language used in the OpenAI disclosure as well as comments by Eric Schmidt seemed to all point that this was a disagreement over intentions behind the use of AI tools rather than an overreach of power, monetary conflict of interest or any sort of personal scandal. Now since it was referenced here was the tweet that Eric Schmidt made Sam Altman is a hero of mine. He built a company from nothing to 90 billion in value and changed our collective world forever. I can't wait to see what he does next. I and billions of people will benefit from his future work. It's going to be simply incredible. Thank you to Sam Altman for all you have done for us. There's also an article from the information here that sort of confirms from insider sources what we're saying here that Ilya was the person who pushed Sam out, which obviously led to Greg and three other researchers subsequently leaving. The day that Sam and Greg left, there was an all hands meeting at OpenAI and at least two employees asked Sutskever whether the firing amounted to a coup or hostile takeover. Ilya responded with, you can call it this way and I can understand why you chose this word, but I disagree with this. This was the board doing its duty to the mission of the nonprofit, which is to make sure that OpenAI builds AGI that benefits all of humanity. Suskiver was also asked whether these backroom removals are a good way to govern the most important company in the world, and he answered, I mean fair. I agree that there is not an ideal element to it, 100%. The current interim CEO, Mira Muradi, who has been overseeing many of the company's teams, referenced the mission. She said our mission and ability to develop safe and beneficial AGI together. She went on to say that the company had three pillars maximally advancing our research plan, our safety and alignment work, particularly our ability to scientifically predict capabilities and risks, and sharing our technology with the world in ways that are beneficial to all. Seeing as she mentioned safety and alignment work, predict capabilities and risks and sharing it in a way that's beneficial to all. I feel like sort of confirms some of the reasons people are speculating and the reasons that I just addressed. And then today, before I was recording this, another article came out from the Information talking about how OpenAI's $86 billion share SAL in jeopardy following Altman's firing. Now, I'm not going to read the whole article here, but main takeaways are listed Company called Thrive agreed to lead the $86 billion valuation tender prior to Altman being fired. Now some of OpenAI shareholders doubt that that tender will ever happen and the venture capitalists that are out there are showing their support for Altman as opposed to OpenAI. And so that's really all of the information as well as sort of speculation about why this has happened that's come out. There's been a lot of other speculation. There's been some conspiracy theories floating around out there about why Sam left. People think that maybe they did achieve AGI artificial General intelligence internally and Sam wanted to push it out, but the other team member said no, this is happening too quickly, we need to slow this down. But all of that is just total speculation. I feel like the narratives that we just looked at in this video feel like the most likely scenario. That's happening there based on Sam being the sort of accelerationist versus Ilya being more of the safetiest. But you know what? The story didn't end here today. Again, before I hit record on this video, an article from the Verge came out saying that OpenAI board is now in discussion with Sam Altman to return as the CEO. Altman holding talks with the company just a day after he was ousted indicates that OpenAI is in a state of free fall without him. Hours after he was axed, Greg Brockman, OpenAI's president and former board chairman, resigned, and the two have been talking to friends and investors about starting another company. A string of senior researchers also resigned on Friday, and people close to OpenAI say more departures are in the work. OpenAI's largest investor, Microsoft, said in a statement shortly after Altman's firing that the company remains committed to its partnership with the AI firm. However, OpenAI's investors weren't given advance warning or opportunity to weigh in on the board's decision to remove Altman as the face of the company and the most prominent voice in AI. His removal throws the future of OpenAI into uncertainty at a time when rivals are racing to catch up with the unprecedented rise of chat GPT. Now, there's not much more known about this here, but to me it looks like Altman and Brockman kind of hold all the cards. They can really go in one of two directions. They can sign back on with OpenAI and in that process completely change the governance structure to make sure that this type of thing never happens again. Or they could go and start up their own competing company with OpenAI and overnight have billions of dollars of financial support from investors, probably bring a whole bunch of researchers over from OpenAI with them and win over the hearts of the public pretty dang quickly because Sam Altman is such a charismatic, likable CEO. So in my eyes, this kind of looks like a major backfire from OpenAI because at the end of the day, it really just put a lot more power into Sam's hands. And we know Sam and Greg are going to land on their feet and do something amazing, regardless of whether it's with OpenAI or on their own. And finally, to wrap up this video, here's a tweet from Gary Marcus, somebody that I actually rarely agree with. He's been all over this story as well, and I do agree with his statements here on Twitter. No idea whether Mira would make a good CEO, but a the board publicly expressed lack of confidence in Sam's veracity b Nonetheless Shortly after the board replaced Sam with Mira, they have reportedly promptly tried to get Sam back. At least three things follow. One the board has proven itself fickle regardless of the outcome, meaning likely the structure of the board's not going to stay the same after all of this. 2 if Sam doesn't come back, Mira may rightfully be perturbed, and if the rumor is correct, they've now undermined her. Maybe she won't even accept or have bigger demand. And three if Sam does come back, they have accomplished nothing and probably lost Ilya and the $86 billion secondary sale and returned to somebody that they don't trust and given him more power, which which may inherently undermine safety from the outside. It's extremely hard to see how all that adds up to a well played, well thought through hand. And to be honest, nothing about this feels very well thought through. The fact that Sam Altman and Greg Brockman were essentially notified minutes before the announcement went out, Microsoft wasn't consulted and it happened middle of the day on a Friday without any sort of like buildup of tension or anything thing. Nothing about this screams well thought out. Although I do have to imagine that Ilia and the other three board members have been sort of thinking through this and working on it for a while. It honestly feels like an episode of Succession. This story just keeps on playing out. I know this is probably not the end of the story here, but I did want to make a quick catch up video and catch everybody up on this roller coaster ride of a soap opera in Silicon Valley. This has been a insane and I've been watching the news around this like crazy. This is my Real Housewives of Orange county or whatever. I love this reality show more than anything else and can't wait to find out what happens next and turn around and ideally share it with you guys. So hopefully you enjoyed this video. Hopefully you learned a little bit more, got a little bit more insight into what's actually going on at OpenAI. Again, a lot of this is speculation. I wanted to share the facts that we know as well as what I feel is the most likely explanation. But again we won't know all of the facts until OpenAI and or SAM come out and make official statements and really break down what's going on. But if I had to guess, I think we came pretty close to nailing it. But we still have to wait and find out and see. I don't know what I'm talking about. I'm just a YouTuber having fun. So hopefully you're enjoying videos like this. And I'm gonna keep on deep diving and digging and sharing what I come up with. And if you like that kind of stuff, subscribe to this channel. Really, really appreciate you. See you in the next video. Bye. Bye.