4 ms·

I wonder if Microsoft owning 49% of OpenAI vastly simplifies such a situation. Or maybe further complexifies it. It's fascinating to watch, anyway.

jacquesm 3y ago
All they need is another 2% and at a measly two billion that would be an easy settlement. The board members get to save face and Satya is off to the races, employees happy, investors happy. It could easily happen.
- croes 3y ago
  They can't simply by additional 2%
  - jacquesm 3y ago
    Why not? An emission could be done and whoever has the right to buy could pick it up. End of story.
    - papercrane 3y ago
      My understanding is the OpenAI holding company, which is controlled by the board of directors, owns 51% of the capped-profit company, with Microsoft owning the other 49%. There doesn't seem to be a scenario where Microsoft can buy a controlling interest without the boards approval.
      - jacquesm 3y ago
        Yes, hence the word 'settlement' in my original comment. As in: you ensure we get a controlling interest and we'll let you go quietly.
        croes 3y ago
        MS doesn't have enough leverage to pull such move. The board could decide to kill the company in MS not only loses a 10 billion invest but has to reconsider its whole artificial intelligence integration push.
        jacquesm 3y ago
        This comment didn't age well. MS did have the leverage, and by offering jobs to 700 people at once they felt safe in their move to pressure the board in a way that I'm still quite impressed by. It's probably the most vivid example of the power of the workforce in the 21st century West.
- agloe_dreams 3y ago
  What is interesting is that Sam noted that OpenAI board should go after his shares if he were to go off on the company...which implies some sort of ownership that others had no prior knowledge of. What's the over-under of his shares being more than 2%?
  - papercrane 3y ago
    Based on OpenAI's structure, I would expect his equity would be in the OpenAI holding company, and not OpenAI Global, LLC which Microsoft is a minority owner of and the holding company is a majority holder. The holding company is what employees and investors have equity in. If Altman had equity directly in OpenAI Global that would be really odd and go against OpenAIs previous disclosures. https://openai.com/our-structure https://openai.com/our-structure
  - ladon86 3y ago
    That was a joke, the fact that he has no shares is the punchline. He is basically saying they have no leverage to stop him speaking out once he’s been fired (which they might if he remained an equity holder).
  - deleted 3y ago
    [deleted]
- zepton 3y ago
  Microsoft couldn't control the OpenAI business even if it owned every unit of every LLC associated with OpenAI (except for the special units owned by OpenAI GP LLC, which is wholly owned+controlled by the non-profit). The operating agreement of OpenAI LLC (which actually operates the OpenAI business) specifies that OpenAI GP LLC (which is wholly owned and controlled by the non-profit) controls it regardless of how many units it owns. See https://openai.com/our-structure https://openai.com/our-structure

jacquesm 3y ago

All they need is another 2% and at a measly two billion that would be an easy settlement. The board members get to save face and Satya is off to the races, employees happy, investors happy. It could easily happen.

croes 3y ago
They can't simply by additional 2%
- jacquesm 3y ago
  Why not? An emission could be done and whoever has the right to buy could pick it up. End of story.
  - papercrane 3y ago
    My understanding is the OpenAI holding company, which is controlled by the board of directors, owns 51% of the capped-profit company, with Microsoft owning the other 49%. There doesn't seem to be a scenario where Microsoft can buy a controlling interest without the boards approval.
    - jacquesm 3y ago
      Yes, hence the word 'settlement' in my original comment. As in: you ensure we get a controlling interest and we'll let you go quietly.
      - croes 3y ago
        MS doesn't have enough leverage to pull such move. The board could decide to kill the company in MS not only loses a 10 billion invest but has to reconsider its whole artificial intelligence integration push.
        jacquesm 3y ago
        This comment didn't age well. MS did have the leverage, and by offering jobs to 700 people at once they felt safe in their move to pressure the board in a way that I'm still quite impressed by. It's probably the most vivid example of the power of the workforce in the 21st century West.
agloe_dreams 3y ago
What is interesting is that Sam noted that OpenAI board should go after his shares if he were to go off on the company...which implies some sort of ownership that others had no prior knowledge of. What's the over-under of his shares being more than 2%?
- papercrane 3y ago
  Based on OpenAI's structure, I would expect his equity would be in the OpenAI holding company, and not OpenAI Global, LLC which Microsoft is a minority owner of and the holding company is a majority holder. The holding company is what employees and investors have equity in. If Altman had equity directly in OpenAI Global that would be really odd and go against OpenAIs previous disclosures. https://openai.com/our-structure https://openai.com/our-structure
- ladon86 3y ago
  That was a joke, the fact that he has no shares is the punchline. He is basically saying they have no leverage to stop him speaking out once he’s been fired (which they might if he remained an equity holder).
- deleted 3y ago
  [deleted]
zepton 3y ago
Microsoft couldn't control the OpenAI business even if it owned every unit of every LLC associated with OpenAI (except for the special units owned by OpenAI GP LLC, which is wholly owned+controlled by the non-profit). The operating agreement of OpenAI LLC (which actually operates the OpenAI business) specifies that OpenAI GP LLC (which is wholly owned and controlled by the non-profit) controls it regardless of how many units it owns. See https://openai.com/our-structure https://openai.com/our-structure