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OpenAI employees confess to using open letter as a bargaining chip

In late November 2023, following Sam Altman’s dismissal from OpenAI, Microsoft’s proposal to employ the entire OpenAI team was met with little enthusiasm among the staff.

As reported by Business Insider, both current and former OpenAI employees were averse to the idea of joining Microsoft, citing differences in corporate culture and potential financial losses. That’s because OpenAI had recently received a valuation of $86 billion, which would enable employees to cash in some of their stock options.

The employees at OpenAI perceived Microsoft as a less dynamic and more bureaucratic company, contrary to their startup’s ethos. Microsoft’s governance structure was forged in the dot.com boom and has become overwhelmingly cumbersome, employees conveyed to Business Insider.

Perhaps rather than an act of solidarity, then, the deluge of X posts “OpenAI is nothing without its people” was more of a bargaining chip to avoid a situation that would a) install OpenAI into Microsoft’s slow business ecosystem and b) cost them their options. 

In fact, according to Business Insider, one even confessed, “Sam Altman is not the best CEO, but millions and millions of dollars and equity are at stake.”

Employee threats were largely a strategic move. “It was sort of a bluff that ultimately worked,” a former employee, still in contact with current staff, revealed. 

Inside Microsoft, the potential mass hiring of OpenAI was seen as a last resort. Despite nearly all OpenAI staff agreeing to follow Altman, many felt relieved that they didn’t have to actually join Microsoft, as noted by a current OpenAI employee who described Microsoft as “the biggest and slowest” of the major tech companies.

OpenAI’s ‘agile’ structure suits the AI industry very well, particularly now the company has somewhat departed from its founding principles and adopted a board angled towards more conventional venture capitalism.

This means the board’s penchant for safety doesn’t restrict OpenAI’s relatively small team from developing more powerful, more lucrative technologies.  

“We all left these big corporations to move fast and build exciting things,” an employee expressed, highlighting the aversion to the bureaucracy at Microsoft.

While employees were ready to act on their threat, according to insiders, their real intention was to seek opportunities with other AI startups. Numerous job offers were likely in the pipeline. This aligns with the trend where tech professionals favor nimble, innovative startups over traditional tech giants.

Financial considerations were also a key factor. OpenAI employees, with high salaries and substantial equity packages, doubted Microsoft’s ability to match these benefits. 

So, was it about the money as much as anything? It would be too cynical to declare that so, as OpenAI has undoubtedly become the dominant influence in the AI industry, and you’ve got to credit the company and its team for that.

But, it is still a capped for-profit with a value of $86 billion, after all. 

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