OpenAI Is Still an $86 Billion Nonprofit

Ten days ago OpenAI was worth $86 billion. Investors in OpenAI were about to launch a tender offer to buy employee shares at that valuation, and employees were lining up to tender; there were willing buyers and sellers at that price. Then events occurred. There was a boardroom coup, and OpenAI’s founder and chief executive officer, Sam Altman, was fired. At one point, the valuation of OpenAI was apparently zero dollars: Several OpenAI investors were noisily saying that they were going to write down their shares to zero,1 and it looked like Microsoft Corp. was about to acquire most of OpenAI’s staff without paying the company (or its other investors) anything for them.

But then there was another boardroom coup, Altman got his job back, and most of the directors who fired him were themselves fired. Altman returned, and there have been suggestions that he (and Microsoft, OpenAI’s biggest investor) extracted some promises that this sort of thing won’t be allowed to happen again, that there will be fundamental governance changes to make OpenAI more robust and, probably, more commercial.