After being forced out of one of the world’s most valuable private companies, Sam Altman is back at the helm of OpenAI in less than five days. The company announced that Sam Altman had been reinstated as chief executive of OpenAI on Tuesday evening this week, successfully reversing his removal by the OpenAI board of directors on Friday last week after a campaign by his supporters, his staff and its investors. Alongside Sam, Greg Brockman is also returning as president of OpenAI. He had resigned in solidarity with Sam. Sam and Greg’s return brings order to OpenAI, one of the world’s most important artificial intelligence companies and the creator of the chatbot ChatGPT, which has been thrown into disarray by a tumultuous storm of five days.
Almost all of OpenAI’s approximately 770 employees have threatened to join Microsoft if the former CEO is not brought back to the helm. The reasons for Altman’s departure were unclear, as board members and employees denied any involvement in “wrongdoing” or “safety” issues, creating an information vacuum.
Last week was like a drama movie, but there are a lot of things that need to be fixed: board composition (fix initiated), employee trust, for-profit status capped vs. non-profit and strained relations with Microsoft. are all critical factors as the business enters its next phase.
The board is, quite rightly, being restructured, removing several members who ousted Sam Altman. The only remaining member of the existing board will be Adam D’Angelo, Quora’s chief executive. OpenAI made this announcement in a post on X. OpenAI called the revamped board the “new initial board,” signaling that more changes are in store in the board’s composition. The two new board members are Bret Taylor (an early Facebook executive and former co-CEO of Salesforce) and Lawrence Summers (former Treasury Secretary and former president of Harvard University). Adam D’Angelo (current board member and CEO of Quora) will continue to serve on the board and act as chairman. It is clear that the composition of the board of directors is likely to shift from researchers and scientists to civil servants, business executives and investors – in line with a typical board of directors of an AI startup.
Sam Altman expressed his optimism in his post on, “I love OpenAI, and everything I’ve done over the past few days has served to keep this team and its mission together. When I decided to join MSFT on Sunday evening, it was clear that this was the best path for me and the team. With the new board and Satya’s support, I look forward to returning to OpenAI and building on our strong partnership with MSFT. Microsoft is the largest investor in OpenAI, having pumped about $13 billion into the world’s most valuable AI startup.
Microsoft CEO Satya Nadella was the kingmaker behind the scenes during the unprecedented 5 days of frenzy at OpenAI. He openly supported the reinstatement of Sam and Greg and the overhaul of the board when he posted on, “We are encouraged by the changes to the OpenAI Board of Directors. We believe this is the first essential step towards more stable, better informed and more effective governance. Sam, Greg and I discussed and agreed that they had a key role to play alongside the OAI leadership team in ensuring that the OAI continued to thrive and further its mission. We look forward to building on our strong partnership and delivering the value of this next generation of AI to our customers and partners.
Even though this all seems great at the end of the saga, there is work to be done at OpenAI. Sam and Greg’s return to the helm brings normalcy and ends the era of instability that has plagued the company for nearly a week. But some fundamental cracks need to be repaired. The board governance structure needs to be refreshed. The first step was taken by replacing the current board with a new initial board, but it is clear that more board members need to be added to increase the ease of decision-making in an organization so complex. There is still no board representation from Microsoft and other investors, as well as the company’s founders. Second, the complex corporate structure of merging a capped for-profit entity with a nonprofit organization has raised questions and sowed confusion in the minds of outsiders. The perception of an organization maneuvering the fine line between driving a mission while maximizing shareholder return via profits is akin to a tightrope shooting line, to say the least. This tightrope walk, although it seems difficult to understand, has given OpenAI the status of leader in AI that it has achieved. Third, employee morale and focus must have declined in the short term due to distractions caused by the OpenAI saga. Employees now seem relieved to see their favorite leadership back home. Fourth, but most importantly, the relationship between OpenAI and Microsoft needs to be managed more carefully. I’m sure Satya Nadella is thinking about how to prevent his biggest bet on AI from being catapulted onto a risk trajectory again by naive board decision-making. Finally, concerns have been raised about a conflict of interest for board member Adam D’Angelo since his company, Quora, runs a product called Poe, a question-and-answer service apparently in competition with ChatGPT. He is also one of the original four OpenAI board members who voted to fire Sam Altman and demote Greg Brockman.
Amid all these lingering questions, Sam Altman has become stronger as a CEO and leader thanks to the overwhelming support of his loyal employees. Sam has the opportunity to usher in an OpenAI 2.0 era, which can further accelerate the meteoric rise of its product adoption trajectory. Time will answer the questions and direct the slope of the trajectory, but it is clear that OpenAI will continue to maintain its leadership in AI for the foreseeable future and even venture beyond software into AI-based hardware products. ‘AI. Like Greg Brockman posted on“We’re so back.”