This Week in Startups

OpenAI Chaos Continues with Sunny Madra and David Sacks | E1852

Nov 21, 2023

01:00:14

Snipd AI

Entrepreneur and AI expert Sunny Madra and tech industry veteran and investor David Sacks join Jason to discuss the unprecedented chaos at OpenAI, including the board's failure, the impact on startups, and the mishandling of the situation. They also explore the motivations of OpenAI's board members and the implications of OpenAI's slowdown on startups and developers.

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Quick takeaways

The recent chain of events at OpenAI has led to a destruction of equity value and significant impact on employees.

The firing of Sam Altman and opaque communication from the board have raised questions about the stability and governance of OpenAI.

The uncertainty and potential downfall of OpenAI create an opportunity for other AI companies and startups to step up and lead in the AI space.

Deep dives

Major value destruction and impact on employees

The recent chain of events, including the firing of Sam Altman and the resignation of the OpenAI team, has led to a significant destruction of equity value and has had a devastating impact on employees, including those dealing with visa processes tied to the company. The destruction of equity value is unprecedented, with many employees expressing sadness and disappointment. The uncertainty around the company's future and the consequences for employees is a major concern.

The importance of alignment and structure in company ownership

01:21

The Structure of OpenAI: Explained

01:10

Possible Reasons for Upset and Tweakings

01:12

Debate over Open AI bringing back Sam and potential consequences

01:30

Introduction

2min

Resignation of OpenAI Team and Destruction of Equity Value

2min

Value Destruction, Immigration, and Recent Events at OpenAI

12min

Discussion on resignations and power move by Satya in an unprecedented situation

4min

Unexpected Firing and Lack of Explanation

8min

Motivation, Chaos, and Board Tension

5min

Nonprofit Structure and Corporate Governance

9min

Motivations and Political Dynamics at OpenAI

5min

Impact of OpenAI Slowdown

14min

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Today’s show:

Sunny Madra and David Sacks join Jason to break down all the chaos of the past few days at OpenAI including why the situation is so unprecedented (17:46), the board’s failure (30:18), the impact on startups (43:34), and much more!

Time stamps:

(0:00) Recapping the chaotic past few days at OpenAI plus some immediate impacts from the fallout

(16:43) NetSuite - Download your free KPI Checklist at http://netsuite.com/twist

(17:46) David Sacks joins the show and explains why this situation is so unprecedented in Silicon Valley

(28:51) LinkedIn Marketing - Get a $100 LinkedIn ad credit at https://linkedin.com/thisweekinstartups

(30:18) How the board could have handled this better, Sam Altman's misaligned incentives packages (or lack thereof)

(37:14) Silicon Valley's battle-tested standard structure, and why you shouldn't innovate on corporate structure

(42:20) Brave - Try the Brave Search API at http://brave.com/jason

(43:34) Impact on startups reliant on OpenAI's models, a brutal momentum killer for OpenAI

(50:39) Predictions: Return of the King? Mass Exodus? Something else?

Follow Sunny: https://twitter.com/sundeep

Follow Sacks: https://twitter.com/DavidSacks