Thursday, May 30

OpenAI Staff Threatens Exodus, Jeopardizing Company’s Future

The future of OpenAI is in jeopardy after more than 700 of its 770 employees signed a letter on Monday saying they may leave the company for Microsoft if the ousted chief executive, Sam Altman, is not reinstalled at the high-profile artificial intelligence start-up.

One of the board members who pushed out Mr. Altman on Friday reversed course on Monday and signed the letter, which was on an internal message board, according to three people familiar with the matter.

The board member, Ilya Sutskever, also posted on the social media platform X, formerly known as Twitter, that “I deeply regret my participation in the board’s actions.”

The ouster of Mr. Altman by the four-member board — which said he had not been candid with it, but did not say how — set off a frantic weekend of corporate jockeying in which Mr. Altman wound up joining Microsoft to start a new A.I. project. Microsoft, which has invested $13 billion in OpenAI, essentially has a 49 percent stake in the company.

The staff’s letter demanding Mr. Altman’s reinstatement said Microsoft had assured OpenAI employees that there were positions for them all if they chose to join its new A.I. subsidiary.

OpenAI and Microsoft declined to comment. Emmett Shear, whom the OpenAI board named as interim chief executive late on Sunday, told a reporter Monday that he could not comment because he was on another call.

The upheaval leaves the future of one of the fastest-growing companies in Silicon Valley history in doubt. At a time when the industry was reeling in the wake of mass layoffs, OpenAI’s technology fueled the creation of hundreds of start-ups. Now many of those businesses are concerned about their prospects.

“This is the debacle of the decade,” said Gaurav Oberoi, the founder of Lexion, a start-up that relies on OpenAI to help companies streamline legal, sales and vendor contracts. “It’s a lesson in how to destroy a huge amount of value overnight and their own reputation.”

Early Monday, in a 530-word post on X, Mr. Shear said he planned to hire an independent investigator to review the details before and after Mr. Altman’s dismissal. He also committed to gathering insight from employees, partners and investors that he said would inform how he rebuilds the company’s leadership team.

“I believe it may take longer than a month to achieve true progress,” said Mr. Shear, the former chief executive of the livestreaming site Twitch. Later in the day, Mr. Shear spoke with Satya Nadella, the chief executive of Microsoft.

During an appearance Monday on Bloomberg TV, Mr. Nadella said that his message to Mr. Shear was clear. “Hey, look, we remain very, very committed to OpenAI and its mission and its road map, and they can count on us,” Mr. Nadella said.

In the fast-moving events, the change of heart expressed by Mr. Sutskever was one of the most startling. “I never intended to harm OpenAI,” Mr. Sutskever, a co-founder of OpenAI with Mr. Altman and its chief scientist, said in his post on X. “I love everything we’ve built together and I will do everything I can to reunite the company.” Mr. Altman reposted the message and added three red hearts.

Mr. Sutskever did not respond to a request for comment.

In addition to Mr. Altman, several key OpenAI employees have already joined Microsoft’s new A.I. subsidiary. This includes Greg Brockman, the OpenAI president who quit the start-up in solidarity after Mr. Altman was ousted. Early Monday morning in a post to X, Mr. Brockman said that he and Mr. Altman would also be joined at Microsoft by three OpenAI researchers: Jakub Pachocki, Szymon Sidor and Aleksander Madry.

Mr. Pachocki led the development of GPT-4, the technology that underpins OpenAI’s popular chatbot, ChatGPT. He has long worked closely with Mr. Brockman, an engineer who helped found OpenAI in 2015 alongside Mr. Altman and has been deeply involved in almost all aspects of the company’s operations from its earliest days.

OpenAI staff was in upheaval in the hours after the board announced Mr. Altman’s ouster, two OpenAI employees told The New York Times. Employees were privately sharing morbid jokes and memes about the power struggles from the HBO show “Succession,” the two said. Many used private group messaging chats and video calls to plan their next steps — and to commiserate with one another.

And Mr. Shear’s challenge in winning their loyalty as chief executive quickly became evident. Most OpenAI employees skipped an all-hands video call Sunday night meant to introduce them to Mr. Shear, and some reacted to a message announcing the meeting with vulgar emojis, according to a person familiar with the matter.

OpenAI still retains a partnership with Microsoft. Mr. Nadella, Microsoft’s chief executive, said in an early Monday post to X that Microsoft would continue to work with the start-up to sell a wide range of products and services based on GPT-4 and other OpenAI technologies.

But if most OpenAI employees leave for Microsoft, the start-up will have difficulty building the next generation of A.I. technologies — systems that will be more powerful than ChatGPT. Others companies, including Google and Meta, are working on such technologies.

Mr. Oberoi of Lexion said that his company had been using OpenAI’s large language models, or L.L.M.s, to develop new features because its A.I. technologies are more advanced than any others in the market. But in the wake of this weekend’s turmoil, he said that Lexion will be developing parallel features with Anthropic, an OpenAI rival, so that the company “can switch quickly if need be.”

“This underscores a big discussion happening: Are you going to build your technology and platforms and key features on third party L.L.M.s?” Mr. Oberoi said. “As a builder on top of their products, I worry if there will be any other sudden decisions that could impact our models. Also, it’s really expensive.”

Late Monday morning, Mr. Altman made an effort to appease the customers of OpenAI. In a post to X, he said that the top priority for Mr. Nadella and himself was to ensure that OpenAI continued to thrive. “We are committed to fully providing continuity of operations to our partners and customers,” he wrote.

“We are all going to work together some way or other, and I’m so excited,” he wrote in another post to X. “One team, one mission.”

Karen Weise contributed reporting.