OpenAI‘s CFO Sarah Friar reportedly informed employees that investor interest in the company’s funding round was “incredibly high.”
What Happened: This announcement aimed to reassure staff following the unexpected resignations of several high-profile executives, reported Axios, citing a source familiar with the situation.
The departures began with CTO Mira Murati, who informed CEO Sam Altman of her decision on Wednesday morning.
Her resignation was publicly announced later that afternoon. Following Murati’s exit, Chief Research Officer Bob McGrew and VP of Research Barret Zoph also announced their departures.
During a half-hour staff meeting on Thursday, Altman, appearing remotely from Italy, along with Friar and Murati, addressed the company’s direction and future. Altman expressed gratitude towards Murati and acknowledged the promotion of Mark Chen to Senior VP of Research and Jakub Pachocki to Chief Scientist.
Friar highlighted the overwhelming investor interest in the funding round, describing it as “very oversubscribed and market-defining.” She noted that investors are impressed by OpenAI’s progress and potential.
A clause in the funding agreement allows investors to request their money back if OpenAI does not restructure within two years, according to the report.
Additionally, OpenAI’s board is contemplating a shift away from its nonprofit roots, potentially granting significant equity to Altman.
OpenAI did not immediately respond to Benzinga’s comment request.
Why It Matters: The recent high-profile departures at OpenAI come at a crucial time as the company undergoes significant changes. CEO Altman recently defended the executive exits, stating that such changes are natural for a rapidly growing company.
OpenAI is also transitioning to a for-profit model, a move that could significantly benefit Altman financially. The restructuring aims to attract more investors and could lead to an IPO in the future.
Furthermore, OpenAI has reportedly been engaging with President Joe Biden‘s administration to expand its data centers, highlighting the economic and national security benefits.
Lastly, OpenAI’s collaboration with Apple Inc.‘s former design legend Jony Ive on a new AI hardware project adds another layer of intrigue to the company’s future. Details about this project remain scarce.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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