CEO suddenly exits, where is OpenAI heading?

What's Next for OpenAI as CEO Abruptly Departs?

Author: Qimin Qian, HuXiu

On the afternoon of November 17th, US time, OpenAI, the company behind ChatGPT, announced a major management shakeup. Sam Altman will step down as CEO and leave the company’s board of directors, and Mira Murati, the Chief Technology Officer, will serve as interim CEO while the company searches for a permanent CEO.

As one of the co-founders of OpenAI, Sam Altman is often referred to as the “father of ChatGPT” and has been the face of OpenAI.

Why would Sam Altman suddenly leave when he is so deeply tied to OpenAI? The reason given by OpenAI in the announcement is that Altman’s departure was decided by the board of directors. He was not sufficiently transparent in his communication with the board, which hindered the board’s ability to fulfill its duties, and the board has lost confidence in Altman’s leadership of OpenAI.

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Screenshot from the official website

In response to the aforementioned changes, Altman made a brief statement on his social media. The gist is that he loves his time at OpenAI… and will later explain his next steps.

Who are the new and old CEOs?

Former OpenAI CEO Altman is considered a “celebrity” in the global tech industry. In 2005, Altman dropped out of Stanford University after studying computer science for a year. He went on to start his own businesses and became a partner at Y Combinator, a well-known startup incubator in the United States, in 2011. He later became the President of YC Group. During his tenure as YC President, Altman established YC China and invited Qi Lu to be the CEO.

In 2015, Altman, along with Elon Musk, Greg Brockman, and others, co-founded OpenAI with the aim of building safe and beneficial general artificial intelligence for the benefit of humanity. In 2019, YC announced that Altman would transition from President to Chairman of the Board in order to focus on OpenAI.

Mira Murati, who temporarily replaces Altman, doesn’t have as deep a connection to OpenAI compared to Altman. Her role in the company is also relatively peripheral. According to foreign media reports, Mira was promoted to become OpenAI’s CTO in 2022, responsible for overseeing the commercialization of OpenAI’s products and improving them based on user feedback.

According to OpenAI’s announcement, Mira has been working in the company’s leadership team for five years and has a deep understanding of the company’s values, operations, and business. The decision to appoint Mira as interim CEO is mainly because of her long tenure and close contact with all aspects of the company, as well as her wealth of experience in artificial intelligence governance.

A six-person board of directors becomes a four-person board of directors

As a non-profit organization, the board of directors is the overall governance body of OpenAI. After this management change, the board of directors will temporarily reduce from a six-person board to a four-person board.

According to the information on the official website of OpenAI, the previous Board of Directors of OpenAI had a total of 6 members, with three being current employees and three being former employees. Among them, the three current employees on the board are: Chairman and CEO Greg Brockman, former CEO Altman, and Chief Scientist Ilya Sutskever.

After the recent management shake-up, OpenAI co-founder Greg Brockman, like Altman, was also “removed” from the board of directors, and he subsequently announced that he would completely leave OpenAI and not hold any position in the company.

According to the latest announcement from OpenAI, the current board of directors of the company has only four members, including Chief Scientist Ilya Sutskever and three other external members who are not current employees.

CEO suddenly being ousted, where is OpenAI heading?
Image: CEO突然出局，OpenAI走向何方？
Screenshot from the official website
The sudden management shake-up at OpenAI has sparked speculation and debates about the company’s internal positions and factional disputes. Although there is no definitive conclusion yet, one thing is certain: OpenAI, which is at the forefront of artificial intelligence, still has a lot of room for improvement in terms of company management.

In addition to internal management capabilities, another major controversy surrounding OpenAI comes from the conflict between non-profit and commercialization. When OpenAI was first established in 2015, it was always envisioned as a non-profit organization. However, researching AI technologies and applications is ultimately an engineering endeavor that requires a large amount of capital investment. OpenAI initially relied on donations and received commitments of $1 billion in donations from organizations like YC, as well as additional donations totaling around $130 million.

But these donations were not enough to meet OpenAI’s needs. In 2019, the company designed a “cap on returns” structure and established a new for-profit subsidiary under the non-profit organization, receiving investments from Microsoft.

Affected by this top-level shake-up at OpenAI, Microsoft’s stock price took a dive in the final moments of trading, ultimately closing down nearly 1.7%. Microsoft stated in an announcement that the company has a long-term partnership with OpenAI and remains committed to its investment in OpenAI, and it has “great confidence” in OpenAI.

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