Everyone in high tech tends to think highly of themselves and their outsized impact on humanity. Every new form of internet-plus-pizza-delivery or mental-nicotine-as-a-service we are slamming in front of your eyeballs is a part of some grand revolution. People glare daggers at me when I talk about the current generation of generative AI and how it is largely a machine that averages collective human output. “Our AI is just average?” People exclaim, “That is just mean!” Yessir, I am making that kind of math-based word joke this morning. I am not proud.
Despite my previous short story about machine intelligence I am pretty optimistic about augmenting human intelligence with machine-based intelligence. I know many people out there fear that our machines will rise up against us, and I appreciate your concerns. I know many people cheered the day that it was clear we would replace all of the slow-moving truck drivers, who cut us off on the freeway, with machines—and subsequently became dismayed when it became easier for computers to create artwork. “We want to get rid of the bad jerbs and keep the good jerbs” is something people say to make themselves feel better.
I don’t know that we are on the precipice of welcoming our new machine overlords yet, nor do I think that there is anything to be gained by warning potential investors in AI that “if you bring about AGI, then your investment may help collapse the value of money and put the entire world out of work.” You can Google the origins of that. I tried three times to find the link that included the disclaimer I read yesterday… Aaand then I got tired.
As an early-stage startup enthusiast, I should be more excited about generative AI than I am. Have I become jaded through twenty-five years of this? It is hard to say. I will say that this weekend’s news about Sam Altman And The Very Important Board Conversation has certainly captured a great deal of high-tech mindshare.
So, let’s talk about that for all of you future-CEOs out there.
I have been blessed with some great friends, advisors, and attorneys over the years. Sometimes, people were all three of these things at the same time. I will say that I did more than a little homework on what it means to start a company, and having spent some time in school serving as a part of student government organizations, I think that it is important for people to understand the notion of governance, and your good friends on the Board of Directors.
I have observed over the years that this is one of those things that most people learn the hard way after going through an experience that equates to something that will make it hard for them to sit down for a couple of days. Almost every founder I know has shared a horrible story about how their startup experience went sideways. While OpenAI is a very large company, we are seeing the exact same phenomenon here.
The whole OpenAI story has not yet been written, and with wild claims about employees and investors alike poking the OpenAI board to bring Sam Altman back, I am curious to see where this ends up in a week’s time, a month’s time, and a year’s time.
I hope everyone involved is looking hard at themselves in the mirror and trying to figure out what they could have done differently leading up to Sam Altman’s Very Curious Friday. Given his tweets (and talents), I am not very worried for him. He seems like the kind of person who has plenty of options and will land on his feet.
What about the Board and the employees involved in the decisions leading up to this moment? They are not in the exact same position, in my opinion.
So, what are some takeaways for all of you future CEOs?
Make sure you understand the makeup of your Board. If you are struggling with this, watch a few seasons of Survivor. The Board of Directors is kind of like the people who vote on the show’s overall winner. At many startups, the CEO will sit on the Board of Directors, and in some cases, they will also be the Chairman. Many investors ask for board seats when they write you a big fat check. Some CEOs also appoint “independent board members” around the same time to ensure they have a good representation when voting for important things. Given what is happening at OpenAI, and conversations to bring Sam Altman back as CEO, I wonder how many of the current Board of Directors will still be there in a week’s time if he is brought back?
Make sure you understand your stock position and your voting rights. The voting rights of many shareholders in a few companies are just polite fiction. Facebook, Zynga, and several other startups had unique corporate structures that put a lot of voting power into one person’s hands. You can see several activist shareholders in big companies like Disney, et cetera, buying blocks of shares before making big moves to change the company. I don’t know that this applies much to OpenAI, but you should educate yourself about it when you build your company.
Make sure you are communicating clearly with your board. This last point is the most important. This was certainly missing here. If you are all communicating well as a leadership team, you don’t Red-Wedding a CEO at a moment’s notice. You also don’t do it on a Friday, but that is a personal quibble. I would hope that anyone taking an OpenAI paycheck is taking a mental health day or three next week as a result of the craziness unfolding. I doubt we will see everyone’s Very Best Work on Monday.
Make sure you are doing the right thing for the right reasons. If everything we read about the motivations for the Altman Incident is all to improve the general safety and goodliness of “Making AI Safe Again,” then this is probably literally the dumbest thing you could do. So, let’s spend three minutes going through the worst-case scenario here. You are taking the person who is the world leader in raising money and pushing the commercialization of generative AI and forcing him out of your non-profit at a moment’s notice on very unfriendly terms. Are you expecting them to go into the corner and sit down quietly for a few years to think about what they did wrong? Or more likely, are they going to go and talk to all of the thirsty check-writing investors out there about how to get absurdly wealthy off of the next iteration of “new internet something-something AI,” alongside the loyal army of well-paid software engineers who are willing to follow them? It seems that is a very likely outcome that will diminish the capabilities of OpenAI even before we ask the question: “With Sam Altman as a competitor unfettered by quote-unquote safety goals, who would write a check to the remnants of OpenAI to keep their staff paid at exorbitant levels, and their server farms running?”
If you measure everything carefully on the surface, Sam Altman has considerable leverage here. There are rumors he is being asked back to the company, and honestly, given everything that has happened, I don’t know how they could make that attractive for him, let alone acceptable. Sam Altman strikes me as the kind of person who is not afraid of getting fired, as is demonstrated by the evidence of… you know… getting fired, and I wager he could raise a pretty substantive pile of money to start NOPEnAI tomorrow.
That is what I think about the whole situation. Who knows what is happening at OpenAI while I write this article, and even what will happen before I publish it?
The only thing for certain is that this is a good opportunity to learn about startups and leadership.
I wish everyone involved the best of luck sorting everything out!
See you next week.
