Hey guys, it's Sasha Open AI The company behind Chat GPT just destroyed itself in the most spectacular fashion. Open AI was the company that everyone was saying would become the next Google Microsoft and Amazon put together. but over the weekend they went and completely self-destructed. This is one of the most spectacular cases of corporate harakiri you will have ever seen and the big winner out of all of this is Microsoft Will come back to that one in a minute.

Now it all started on Friday November 17th on Friday the Board of Openi decided to fire Sam Mman, the CEO who oversaw the fastest growing tech company ever. Mr Oldman's departure follows a deliberate review process by the board which concluded that he was not consistently candid in his Communications. With the board hindering its ability to exercise its responsibilities, the board no longer has confidence in his ability to continue leading Open. AI Instead of Sam they appointed Mera Morati as the interim CEO She was the chief technology officer before that appointment and the announcement said search process underway to identify permanent successor.

Obviously, the world of tech exploded when this news came out, because nobody outside of Open AI seemed to have any idea this was even theoretically on the cards and this is a common problem for this new age of unicorn startups that go from zero to valuations in the tens of billions of dollars. The board of Open AI consisted of a bunch of tech Whiz Kids and from my research this morning, it appears that the oldest member of the board was Tasha McCoy who is 41 And the majority of the other members are around their mid-30s and the issue is that the profile of every single board member appears to be exactly the same. Mature companies would typically have board members with very different perspectives coming from very different backgrounds so that they can properly debate and assess critical moves from several different angles and consider all the different things that you know people with fiduciary duty need to consider. But the Open AI board fired the CEO because according to them they couldn't trust him and that is a good reason to fire the CEO.

But if you're going to get rid of the main guy, if you're going to get rid of the face of the company, you better have some kind of good plan of what it is that you're going to do. you know, after firing them, and it appears that the board of Open AI had no plan whatsoever because when it all blew up in their face literally immediately after it happened, they called Sam to come back in the very next morning to try and negotiate to come back if he came back. Miram Morati would have been CEO for less than 24 hours, which would maybe be some kind of a new record. Interestingly, Samman was himself CEO of Reddit for 8 days in 2014, but that's a whole different story for another day.

So they called this guy back because they realized that they just shot themselves in the foot so hard that they didn't just lose a few toes. They blew off the foot. They blew off the leg and most of the Torso at the same time. According to reports immediately after Open AI fired Sam Greg Brockman The chair of the board also quit the company and he wasn't the only one.

A whole bunch of Engineers from Open AI began posting in support of Sam on social media. Many writing Open AI is nothing without its people and Sam was busy leaving heart under all of these comments. So the very real risk was that Sam was going to go off and set up a direct competitor doing exactly the same thing with all of the engineers who walk out and join that competitor and the board of Open AI would be left standing there holding their private parts in their hands. But it worked out even better than that.

Sam Came into Open AI with a guest pass I Am not sure they really needed to Ram it down his throat that they just fired him just a few hours before that, but you know, making him sign in as a guest at the front desk. but I guess the dick measuring contest was in full swing. so why not? Apparently in the talks on Sunday the board members who just fired Samman if few hours earlier were trying to offer him some kind of weird deal to you know, try to make it look like he's coming back in some madeup role without actually having any real responsibility. just so that you know everyone could get off their backs because apparently even Microsoft the company that invested billions of dollars into open Ai and owns 49% of the business even they did not know that this was coming.

So after a day of trying to save face, it sounds like Sam Alman got really frustrated with them and told the board to go and do one and the board began panicking because they realized they made a decision In the Heat of the Moment without actually thinking it through. And this is where having people with actual experience on the board would have helped because forgetting to think about the politics and the Pr angle of firing your CEO is an absolute rookie mistake. Nobody seemed to think you know what's going to happen with the employees. Are they going to be annoyed? Are they going to walk out? Are they going to go and join this new company? This guy might start.

What about the companies that we work with? Are they going to be frustrated? What about Microsoft The company who owns 49% of our company? Maybe we should I Don't know. Let them know before they read it in the news as the board was busy panicking because they up so hard, they went and found a new CEO in the search that lasted at least a couple of minutes. The new CEO is EMT sheer who was conveniently available after leaving his previous job as CEO of Twitch in March 2023. So they found a guy who was out of a job happens to live in San Francisco used to work in Tech used to work just down the road in attempt to fix the mistake that they made and immediately after all of this happened late on Sunday night SAA Nadela the CEO of Microsoft played his move after talks at Open AI broke down.

He was naturally probably a bit pissed off because Microsoft gave Open AI billions of dollars and the B just went and fired the guy that Microsoft wanted to be in charge to drive all of this without so much as letting Microsoft know. So late on Sunday night, literally minutes after talks at Open AI F failed, Sael announced that Sam Alman would be joining Microsoft Here is the Tweet We remain committed to our partnership with Open A and have confidence in our product road map, our ability to continue to innovate with everything we announced at Microsoft ignite and in continuing to support our customers and partners. So unlike the Open AI board, Satina actually understands the importance of politics and says hey, don't worry, we're definitely still working with Open AI It is patently obvious from the wording that he means the exact opposite I Love a bit of passive aggressive corporate speak. Now talking of passive aggressive He then says we look forward to getting to know EMT Shear and Open Ai's new leadership team and working with them.

You murdered that one so it looks like he's saying something very polite. You know we look forward to getting to know emit sheer blah blah blah But what he's actually saying is how the did the board not consult with Microsoft and not let them know beforehand about the leadership change And who the hell is this M Sheer guy anyway and what are you going to do? Are you all guys going to resign because there's going to be now a new leadership team that we look forward to getting to know is the bit that actually means who the is this guy and where did you find him And then he gets to the real meet and we're extremely excited to share the news that Sam Alman and Greg Brockman remember the guy who quit as chairman of the board at Open AI together with colleagues will be joining Microsoft to lead a new Advanced AI research team. So he is rubbing it into Open Ai's face saying right there in the announcement that a whole bunch of Open AI Engineers are already on their way over to Microsoft hours after all of this blew up. They should probably just go and send over a few buses to Open the Eyes so that all of these Engineers can come over nice and quick.

We look forward to moving quickly to provide them with the resources needed for their success. So Microsoft is basically saying screw Open AI We just got the guy who made chat GPT happen as CEO of Open AI we are getting a whole load of their best Engineers who are queuing up at the front door and Microsoft AO was already the computer hardware that Open AI was using to train their models in the first place and sure, Microsoft will keep working with Open AI until their own models are built. What choice have Open AI got? But Microsoft has virtually unlimited resources and it sounds like they would much rather own all of the pie rather than just a slice of it. They're going to be throwing all of those resources at building their own chat GPT as soon as possible and destroying Open AI in the process.

The moment that happens, there will be precisely zero reason for Microsoft to keep paying Open AI for using their tools. Progress at Opene is naturally now going to slow down. They're busy trying to figure their own politics out, trying to find who's going to be doing what job. a load of their Engineers are apparently in the process of leaving and the likelihood is that Microsoft will not be the only ones building serious artificial intelligence.

Solutions Elon Musk's Xai just released their first version of Gro and there will be many others joining this race. It appears that the board have realized how badly they up already. Elas Sukova who apparently was one of the board members responsible for firing Sam just said I Deeply regret my participation in the board's actions I never intended to harm open AI I Love everything we built together and I will do everything I can to reunite the company. The fact that this comes barely hours after they fired the CEO shows how little thought they put in to firing the CEO in the first place openly.

I could have been become the Google of this new AI world, but it sounds like the company was way too immature and decided to self-destruct because a bunch of the board members disagreed on the direction the company should be taking. Will this turn out to be another Skype You know, an example where Microsoft bought a company and then made it so bad that nobody wanted to use it is possible. but Satia Adella is not Steve Bulmer, who was the Microsoft CEO before him Steve Bulmer is famous for laughing at the iPhone when it came out because unlike the Windows phone, it didn't have a keyboard and he was so successful that Microsoft share price went down 35% during the 14 years that he was in charge. Satia Adela is a whole different animal.

He became CEO of Microsoft here and I have a funny feeling that open AI is going to regret acting like petrol and children at the board meeting on Friday for a very long time.