Most OpenAI Staff Threaten To Quit, Join Microsoft Unless 'Incompetent, Incapable' Board Resigns

Tyler Durden's Photo
by Tyler Durden
Monday, Nov 20, 2023 - 08:45 PM

Update (1545ET): 

In a post on X, Salesforce CEO Marc Benioff stated that his company "will match any OpenAI researcher who has tendered their resignation full cash & equity OTE to immediately join our Salesforce Einstein Trusted AI research team under Silvio Savarese."

The fight for OpenAI talent is underway. 

*   *   * 

Update (1401ET):

The number of OpenAI employees considering resignation has surged to 700, with some estimates suggesting it is about 90% of all staff. 

Sam Altman posted on X:

  • We have more unity and commitment and focus than ever before
  • We are all going to work together some way or other, and I'm so excited
  • One team, one mission.

*   *   * 

Update (0920ET):

Tech blog Wired has reported that 490 OpenAI employees may quit and find jobs at the "newly announced Microsoft subsidiary run by Sam Altman and Greg Brockman" if the board does not resign. 

"The process through which you terminated Sam Altman and removed Greg Brockman from the board has jeopardized all of this work and undermined our mission and company," the employees wrote in the letter, adding, "Your conduct has made it clear you did not have the competence to oversee OpenAI."

The latest data from The Information indicates OpenAI has more than 700 employees. A potential mass exodus could spark disastrous consequences for OpenAI. 

Here's the letter to the board where the employees mention that if they choose to resign, they will immediately have employment opportunities at Microsoft:

To the Board of Directors at OpenAI,

OpenAI is the world's leading AI company. We, the employees of OpenAI, have developed the best models and pushed the field to new frontiers. Our work on AI safety and governance shapes global norms. The products we built are used by millions of people around the world. Until now, the company we work for and cherish has never been in a stronger position.

The process through which you terminated Sam Altman and removed Greg Brockman from the board has jeopardized all of this work and undermined our mission and company. Your conduct has made it clear you did not have the competence to oversee OpenAI.

When we all unexpectedly learned of your decision, the leadership team of OpenAI acted swiftly to stabilize the company. They carefully listened to your concerns and tried to cooperate with you on all grounds. Despite many requests for specific facts for your allegations, you have never provided any written evidence. They also increasingly realized you were not capable of carrying out your duties, and were negotiating in bad faith.

The leadership team suggested that the most stabilizing path forward - the one that would best serve our mission, company, stakeholders, employees and the public - would be for you to resign and put in place a qualified board that could lead the company forward in stability.

Leadership worked with you around the clock to find a mutually agreeable outcome. Yet within two days of your initial decision, you again replaced interim CEO Mira Murati against the best interests of the company. You also informed the leadership team that allowing the company to be destroyed "would be consistent with the mission."

Your actions have made it obvious that you are incapable of overseeing OpenAI. We are unable to work for or with people that lack competence, judgement and care for our mission and employees. We, the undersigned, may choose to resign from OpenAI and join the newly announced Microsoft subsidiary run by Sam Altman and Greg Brockman. Microsoft has assured us that there are positions for all OpenAI employees at this new subsidiary should we choose to join. We will take this step imminently, unless all current board members resign, and the board appoints two new lead independent directors, such as Bret Taylor and Will Hurd, and reinstates Sam Altman and Greg Brockman.

The countdown to OpenAI's demise has begun. 

*   *   * 

Microsoft shares climbed 2.7% in premarket trading, approaching a new record high, following the announcement that OpenAI co-founders Sam Altman and Greg Brockman will head a new cutting-edge AI research division for the tech giant. This development is particularly surprising given that Altman was dismissed from OpenAI just last week, with Emmett Shear, the co-founder of Twitch, a video streaming platform, stepping in as the interim CEO overnight, The Wall Street Journal reported. 

Shear's appointment as OpenAI's interim CEO marks the second leadership change in three days, following the board's decision to terminate Altman on Friday and technology officer Mira Murati shortly after. 

"I took this job because I believe that OpenAI is one of the most important companies currently in existence," Shear wrote on social media platform X. He continued, "I want to do everything in my power to protect it and grow it further."

On Sunday afternoon, Altman returned to OpenAI's headquarters, holding a guest pass. The former CEO said, "First and last time I ever wear one of these."

Co-founder, chief scientist, and board member Ilya Sutskever - who fired Altman - told employees about Shear joining the company late Sunday. 

On a side note, Elon Musk has come to the defense of Sutskever's role in former CEO Sam Altman's ouster.

"Ilya has a good moral compass and does not seek power," Musk wrote in a post on X, the platform formerly known as Twitter, on Sunday.

"He would not take such drastic action unless he felt it was absolutely necessary," Musk continued.

Early Monday morning, Microsoft chief executive Satya Nadella wrote in a post on X, "Excited to share the news that Sam Altman and Greg Brockman, together with colleagues, will be joining Microsoft to lead a new advanced AI research team."

"The mission continues," Altman wrote on X, commenting on Nadella's message.

Elon Musk commented on Altman's post, "Wild Times." 

Bloomberg noted some OpenAI employees posted their resignations on X after hearing the news. 

OpenAI developer Logan Kilpatrick wrote on the social media, "This has been an utterly devastating last 3 days."

The abrupt shake-up at the maker of viral chatbot ChatGPT echoes a classic Silicon Valley story: the rift between founders and their board. Some have warned parting with Altman could be disastrous: 

And this... 

Shares of Microsoft in premarket trading were up as much as 2.7% on the news. The tech giant has an agreement with Open AI valued at around $13 billion (which has not all been spent and includes not just cash but cloud service credits - all of which could be yanked out from under OpenAI now if terms of the agreement are not met). However, a statement from Microsoft on Friday - after Altman's initial ouster - confirmed it remains committed to its partnership with OpenAI. 

Analysts, commenting after Altman's shock exit, were deeply concerned: 

"Train wreck situation at OpenAI might be one of the biggest debacle decisions in the history of Silicon Valley," Wedbush's Dan Ives wrote in a note. 

Here's more of what Wall Street analysts are saying (list courtesy of Bloomberg):

Evercore ISI

  • Analyst Kirk Materne says the weekend has been full of back and forth regarding the OpenAI drama, but "for Microsoft investors, it ended in a good place with the news"

  • "While it remains to be seen how much 'brain drain' there will be at OpenAI, we think the fundamental risk to Microsoft is largely contained with Altman and team on board"

Bloomberg Intelligence

  • Altman's departure could open the way for other foundational models like Meta's Llama and Google's Gemini to attract more interest

  • "The popularity in those open-source large language models may grow if Altman's exit was related to ChatGPT's roadmap," analyst Mandeep Singh writes

RBC Capital Markets

  • While OpenAI's management changes can cause some concerns for Microsoft, OpenAI remains a leader, writes analyst Rishi Jaluria Macquarie

  • Microsoft's relationship with OpenAI remains intact, analyst Frederick Havemeyer writes, adding that there should be little impact for its Azure business

What a dizzying weekend!