A nonbinding letter of intent in 2018? That is a limited downside unlimited upside kind of risk you take to fund extreme moon shots. Boom Supersonic did the same approach with United airlines, to fund a still undeveloped supersonic Airplane. A 1M investment like this is a hedge that has capped downside, restricted to Altman's personal money, and an infinite upside that gives an incentive to the founders to succeed. At the time the value of the investment is paper zero for Altman, but gives the founders, who were probably the most promising he has seen in the space, large help with fundraising, hiring, and credibility with future sales. OpenAI does not have to buy the chips unless they meet the criteria, In 2018 OpenAI was one of many startups plucking at a problem that seemed insurmountable. If you are trying to push into a problem and can't afford to do what Apple did to build both the hardware and software to solve it, you focus on the one and try to help the other however you can.<p>In WeWork, the CEO took a trademark that costs a couple of thousand dollars, and charged himself millions for it from company money - that's personal enrichment. Incubating a thing considered highly risky and expensive 5 years is not personal enrichment, its personal risk that helps more the likelihood of it being less impossible instead of a chance at enrichment from two companies you don't even know would be viable (OpenAI) 5 years from then.
This kind of stuff is the reason why Altman was fired.<p>The board lost trust for his honesty from many small things that kept accumulating. Altman is back on condition that there is a investigation.
I'm as skeptical of OpenAI's dealings as anyone, but a $1m investment in a chip startup doesn't sound like he's a material owner. They've raised $33 million so far, minus the whole Prosperity7 divestiture kerfluffle (national security made a saudi-backed fund sell), so I'd be surprised if he owned in excess of 5%.<p>It looks to me like exactly the kind of investment I would expect a wealthy angel to make in startups related to their interests, not undue bias.
Unfortunate but unsurprising, given all the discussions and suspicions that the [recent] power struggle at OpenAI was about conflict of interests. This deal goes back to 2019, so it can only throw more oil on the fire about what's been happening since.
Adam Neumann of WeWork owned the trademark to "We" and a whole bunch of buildings which he leased back to "WeWork". That worked out very well for him.
As a VC, isn't "Somebody wants to buy our stuff, we just need money to deliver on it" the ideal pitch?<p>The alternative was that OpenAI prepaid for these chips, and took on a lot of risk. From Altman's position, he's personally taking on risk instead of having OpenAI (and its investors) take it on.
Come on. A guy mentions Sam's sister in his post and it's immediately flagged and hidden xD this site sometimes, seriously, the techbro team picking and worshipping is something else haha
- You make a lot of money, do you?<p>- I make, no, I paid enough for health insurance. I have no equity in OpenAI.<p>- Really? That's interesting.<p><a href="https://www.youtube.com/watch?v=H7FsL6GPesY&t=19s" rel="nofollow noreferrer">https://www.youtube.com/watch?v=H7FsL6GPesY&t=19s</a>
Now key question is not is it corruption but on the Elon scale what this might be as Elon himself has done worse self-interest dealings but in Elon's defense he does ask his corporate boards to weigh in...
Google has their own chips. Amazon do... Meta as well...<p>Vertical integration is a competitive advantage worth pursuing for OpenAI. The spin is just that - spin.
I find it interesting that so many people here are quick to defend a person’s right to moonlight on whatever they want, and the right of a person not to have their IP stolen by the company they work for. But when it’s a public figure suddenly we are on the side of the plantation owners..<p>Good for Sam, I say. Money aside he should be allowed to keep his interests separate. Just because this other company is AI related doesn’t mean it’s working in an area OpenAI was even interested in pursuing.
The guy doesn't even hold personal shares at OpenAI, which could've been worth billions if he did (he's a cofounder and CEO to remind you, so it's unheard of), and you're blaming him for buying chips from a startup he made a small investment in? Seriously. Maybe go after the CEOs who rob their employees and take all the money to themselves.<p>Just to be clear, I never met the guy and have no affiliation with OpenAI.