The Sam Altman effect: ‘His superpower is getting people onside’

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The Sam Altman effect: ‘His superpower is getting people onside’

21 November 2023 Technology & Digitalization 0

OpenAI chief Sam Altman stood on stage in San Francisco earlier this month to announce that ChatGPT, the start-up’s brainchild which kick-started a new era of artificial intelligence a year ago, has 100mn weekly users.

He also announced the company would halve the price of its software and launch an AI app store, in moves designed to proliferate the use of the revolutionary technology. Altman paused between every sentence to let the applause die down.

His ability to inspire would also be seen weeks later, after OpenAI’s board abruptly sacked him. The defenestration served only to trigger an internal revolt, with the majority of staff demanding Altman’s immediate reinstatement.

Tech luminaries from Eric Schmidt to Vinod Khosla have rushed to his defence. Microsoft chief executive Satya Nadella offered Altman a new role in leading an AI research division at the tech giant, with a promise to provide “the resources needed for their success”.

As his fate hangs in the balance, the 38-year-old entrepreneur who has played a central role in the establishment of the multibillion-dollar generative AI industry could now determine its future. 

“His superpower is getting people onside, shaping narratives, pushing situations into the shape that work for him,” said one person with direct knowledge of the negotiations between Altman and the OpenAI board. “It makes him impossible to oversee.”

Artificial intelligence’s ambassador

Altman’s star has risen over the past two years, as OpenAI pushed the boundaries of generative AI — a technology that can create high-quality images, text and code that are largely indistinguishable from human output.

In November last year, OpenAI launched ChatGPT, a sophisticated question-and-answer chatbot. The product’s popularity resulted in corporate giants like Microsoft, Google and Salesforce and a host of tech start-ups launching their own chatbots and AI-infused software products, much of it built with OpenAI’s underlying AI technology.

Under Altman, OpenAI has been transformed in eight years from a non-profit research outfit into a company reportedly generating $1bn of annual revenue. Customers range from Morgan Stanley to Estée Lauder, Carlyle and PwC. 

The success has made Altman the de facto ambassador for the AI industry, despite his lack of a scientific background. Earlier this year, he embarked on a global tour, meeting world leaders, start-ups and regulators in multiple countries. Altman spoke at the Apec Asia-Pacific regional summit in San Francisco just a day before he was sacked. 

Schmidt, the former chief executive of Google, posted on X: “Sam Altman is a hero of mine. He built a company from nothing to $90bn in value, and changed our collective world forever. I, and billions of people, will benefit from his future work — it’s going to be simply incredible.”

A dropout from Stanford University, Altman is a product of Silicon Valley. His first start-up, the location-based social media service Loopt, didn’t take off. But it was enough to get him noticed by Y Combinator founder Paul Graham, who plucked him from relative obscurity, aged just 28, to run the tech incubator.

Y Combinator’s successes include Airbnb and payment company Stripe, and the job gave Altman a ringside seat for some of the hottest new investment fads, and a taste for backing grand visionary projects. 

“There were only a handful of people investing in these technologies,” said Alexandr Wang of Scale AI, a company first backed by Y Combinator, earlier this year. “He’s willing to take big bets. It’s one of the things that made him a great investor. He’s willing to bet long-term.”

The standout quality that Altman possesses, according to those who have worked with him, is his ferocious ambition, and ability to corral support.

He has been described as “deeply, deeply competitive” and a “mastermind”, with one acquaintance saying there is no one better at knowing how to amass power.

Making AI pay

Altman’s stated vision for AI is to create a powerful general technology that could be safely used to advance humanity.

“I think it doesn’t make sense to try to shoehorn us into a company from the last generation of tech, because this is just like a different thing, right?” he told the FT in an interview earlier this month. “Our product is intelligence as a service . . . super-capable intelligence. The kind of intelligence where you can say, ‘go cure this disease’.” 

AI wasn’t Altman’s only bet, however. He has sunk $375mn of his own money into nuclear fusion start-up Helion and has been closing in on a $100mn funding round for his iris-scanning crypto start-up Worldcoin.

Altman had also been attempting to raise as much as $100bn from investors in the Middle East and from SoftBank founder Masayoshi Son to establish a new microchip development company that could compete with Nvidia and TSMC to train powerful AI models, according to one person with knowledge of the situation. These efforts had caused concerns on the board prior to his firing, this person said.

All of Altman’s ventures fed into his goal of building cheap, powerful machine intelligence and making it accessible at scale. “I think there is this loose fabric of companies coming together, that are all kind of going to work together to point in the same direction. OpenAI-Microsoft is one such example. I have others that do over time,” he said. 

In the past two years, Altman has struggled with finding the best way to balance AI’s huge moneymaking potential with OpenAI’s original mission of making sure the technology benefits humanity at large.

Although initially set up as a non-profit, Altman later recast the group in order to bring in a $1bn investment from Microsoft. Its new model capped the returns outside investors could make from a new commercial arm while directing any extra profits into a not-for-profit fund.

“It has this strange structure . . . where the for-profit company runs most of the day to day, but it’s governed by a non-profit and the non-profit’s responsibility is to uphold the mission of ensuring AGI is for the benefit of humanity,” said a person with knowledge of the OpenAI board’s operations.

Notably, Altman said he didn’t take any personal equity in OpenAI, which would ostensibly keep him aligned with the company’s charter and mission. One person described the arrangement as the “ultimate power move”, helping the independently wealthy Altman to convince others of his bona fides.

Altman has proven to be a revered leader, capable of organising the world’s leading researchers around his vision. According to staff, there was a cult-like following for him within OpenAI. This was evidenced by a letter to the board on Monday morning — now signed by almost all of the company’s 770 employees, according to people familiar with the matter — threatening to quit unless the board resigned and Altman was restored.

Regardless of the board’s concerns over his leadership style, including stating Altman was “not consistently candid in his communications” with them, prominent investors continue to see him as the key to the company’s success.

One described their firm’s position simply as: “We want Sam back.” Khosla, an early investor, described Altman as “a once-in-a-generation CEO”.

Jessica Livingston, co-founder of Y Combinator, posted to X: “The reason I was a founding donor to OpenAI in 2015 was not because I was interested in AI, but because I believed in Sam.”

Additional reporting by Richard Waters