Sam Altman in 2019. Image: Steve Jennings/Getty Images for TechCrunch via Flickr (CC BY 2.0)
The potential new measures being considered follow the board’s rejection of an unsolicited bid from an Elon Musk-led group.
OpenAI may protect its nonprofit board’s power by granting it special voting rights in a bid to fend off a hostile takeover from Elon Musk.
According to a report in the Financial Times, the company’s CEO Sam Altman and the rest of the board members are weighing up new governance measures that could allow the nonprofit board to overrule major investors as the company moves towards a traditional for-profit model.
The latest discussions follow OpenAI’s decision to officially turn down an offer of $97.4bn from an Elon Musk-led group of investors.
Writing on behalf of the OpenAI board of directors, chair Bret Taylor said the board rejected Musk’s “latest attempt to disrupt his competition”.
“OpenAI is not for sale,” he wrote in a statement. “Any potential reorganisation of OpenAI will strengthen our nonprofit and its mission to ensure AGI benefits all of humanity.”
When Musk initially made the offer, he said in a statement through his lawyer that it was time for OpenAI to “return to the open-source, safety-focused force for good it once was”.
This followed years of feuds with Altman about the direction of the company Musk co-founded, including lawsuits and court orders attempting to block the transition to a for-profit company. Musk then said he would withdraw the offer if OpenAI took the ‘for sale’ sign down.
While the bid has now been formally rejected, it appears the hostile takeover attempt may have still succeeded in its original mission.
While Musk has form when it comes to hostile takeovers, the real intention behind the OpenAI bid could have really been about complicating Altman’s for-profit plans for OpenAI.
His offer to withdraw the bid if the board protects its nonprofit status highlighted this desire, and with a fiduciary responsibility to the nonprofit’s charter, it seems the board are now considering how best to protect the beneficiaries of the nonprofit.
Meanwhile, Musk remains a key competitor against OpenAI with xAI and its chatbot Grok. Just yesterday (17 February), the man who took over Twitter announced the latest version, Grok 3, which he claimed to be the “smartest AI on Earth”.
However, the AI is currently in beta mode and still being trained, and extreme claims such as this much be taken with a large pinch of salt, especially from the proprietor.
Sam Altman in 2019. Image: Steve Jennings/Getty Images for TechCrunch (CC BY 2.0)
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