Elon Musk says he’ll drop his $97 billion OpenAI bid on one condition

Simone Del Rosario:

Elon Musk says he’ll withdraw a $97 billion bid to buy ChatGPT-maker OpenAI … if the company stops shifting its business to a for-profit entity.

Elon Musk:

So open AI is meant to be open source nonprofit, and now it is closed. They changed the name to closed for maximum profit. Ai closed for voracious profit.

Simone Del Rosario:

In a court filing, Musk’s lawyers wrote…

“If OpenAI, Inc.’s Board is prepared to preserve the charity’s mission and stipulate to take the ‘for sale’ sign off its assets by halting its conversion, Musk will withdraw the bid.”

It’s a bid OpenAI CEO Sam Altman never took seriously.

Sam Altman:

“It’s ridiculous. Yeah, how so what? The company is not for sale. The company is not for sale. It’s like another one of his, you know, tactics to try to, like, mess with us. ”
https://drive.google.com/file/d/1CDzXcBp6Kq_aPTEuB0cK4vRf6utAJg0Y/view?usp=drive_link

“No. OpenAI has a mission. We are an unusual organization and we have this mission of making AGI benefit all of humanity, and we are here to do that.”

Simone Del Rosario:

Elon Musk co-founded the company and says he provided the first $50 million of the company’s funding. Years later, Musk left the company after disagreeing with other founders about OpenAI’s future. Since then, the relationship has become contentious … and litigious.

Sam Altman:

This is a tremendously sad I grew up with Elon as like a mega hero. I thought what Elon was doing was absolutely incredible for the world. And I’m still, of course, I mean, I have different feelings about now, but I’m still glad he exists, and not, not just because, no, I mean that genuinely, not, not just because I think his like companies are awesome, which I do think, but because I think he like at a time when most of the world was not thinking very ambitiously.He pushed a lot of people, me included, to think much more ambitiously.

Simone Del Rosario:

Since its founding in 2015, the AI innovator has been a nonprofit. In 2019, they added a “capped profit” arm that was still controlled by the nonprofit’s board of directors.

Musk twice sued OpenAI for branching out into the profit business, most recently in August.

In September, it came out that CEO Sam Altman is working to restructure the company into a for-profit endeavor. That would eliminate the nonprofit arm’s control over the for-profit business.

Musk is attempting to stand in the way of that transition. OpenAI now he’s contradicted his own suit by making “an improper bid to undermine a competitor.”

Elon Musk:

OpenAI has gotten this far while having at least a sort of dual profit, nonprofit role. What they’re trying to do now is completely delete the nonprofit and and, and that seems really going too far. You know, the I provided all of the funding for opening at the beginning, for the first almost $50 million for nothing, for as a nonprofit, and it was meant to be open source. And so, you know, I think this is analogous to, like, if you pay, but if you find a nonprofit to preserve the Amazon rainforest, but then they, but instead, they turn into a lumber companies and chop down the trees and sell them for wood. You’ll be like, wait a second, that’s the exact opposite of what I paid, what I donated the money for.

Sam Altman:

the nonprofit will continue as a very, very strong thing. The mission is really important, and we’re just, you know, we’re totally focused on making sure we preserve that.

Sam Altman:

I think OpenAI has done the most to push the benefits of AI into the world of anyone. We have open source a lot of things. I think we should probably open source somewhat more. We’ll probably do that. Grock is not super open source either. But, you know, that’s not that’s up to him.

Simone Del Rosario:

In December of last year, OpenAI challenged Musk’s claims of AI altruism. In a blog post, the company said Elon Musk years ago wanted to make OpenAI for-profit.

Sam Altman:

It became clear after GPT one and some other work that we were going to need to scale. And we started, and also Elon decided to stop funding us as a nonprofit, and we couldn’t get somebody else to do it, that we needed to find a way to make a capped profit.

Simone Del Rosario:

Musk’s offer does throw a wrench in the company’s transition. Aside from having to keep its lawyers toiling away in the courts, OpenAI’s board needs to consider the offer – and its value – if it remains on the table.

That’s because Altman basically needs to buy out the nonprofit arm’s controlling interest to turn it into a for-profit model.

The drama is unfolding while OpenAI works on its latest fundraising round. Japan’s Softbank is reportedly looking at investing up to $40 billion, which would push OpenAI’s valuation up to around $300 billion, according to the New York Times.