Entrepreneur Musk proposes a $97 billion deal for OpenAI, drawing a sarcastic reaction from Altman
Ten years ago, Musk and Altman founded OpenAI, a leading AI company in the world. After some time, Musk decided to leave and establish a rival company, xAI. Now, he's trying to rejoin OpenAI, but his proposition is turned down.
According to reports, OpenAI CEO Sam Altman shows no interest in a takeover led by Musk and his associates. The Information claims that Altman informed his employees about the board's intentions to dismiss the idea of merging with Musk's team.
In reaction to the offer, Altman took to Twitter with a sarcastic response, "No thanks, but we'll buy Twitter for $9.74 billion if you want."
Musk's consortium put forth a $97.4 billion offer to acquire the non-profit organization controlling OpenAI on Monday. "It's time for OpenAI to return to its roots as an open-source and security-focused force for good," Musk asserted.
OpenAI's $157 Billion Valuation
Supporting Musk's proposal is xAI, which could potentially merge with OpenAI following a transaction. Musk was one of OpenAI's original founders but departed before the rise of ChatGPT, the widely recognized AI model.
Formed in 2015, OpenAI started as a non-profit research institute dedicated to AI. In 2019, OpenAI LP, a for-profit subsidiary, was established, and major companies like Microsoft poured billions in funding. Towards the end of 2022, the company introduced ChatGPT, triggering a global AI boom still ongoing. At its latest funding round in October, OpenAI was valued at $157 billion.
OpenAI's unique ownership structure aimed to foster the development of "safe Artificial General Intelligence" (AGI), a superintelligence that would serve humanity. However, now, OpenAI is trying to transition from a non-profit to a for-profit organization to secure the required funds for exemplary AI development.
Enrichment Insights
- Altman's Vision for OpenAI: Altman seeks to convert OpenAI into a profit-driven company, aligning with his vision for its growth and development. His shift from a non-profit to a for-profit model is critical for the company, and Musk's offer might disrupt this plan[1][2][4].
- Strategic Partnerships: Under Altman's leadership, OpenAI formed alliances with AI leaders and investors like Microsoft and SoftBank. These relationships are vital for OpenAI's development, and Musk's takeover could potentially jeopardize these collaborations[3][4].
- Public Response and Jabs: Altman's response to Musk's offer was not only a rejection but also a public rebuttal. He tweeted, "No thanks, but we'll buy Twitter for $9.74 billion if you want," a direct reference to Musk's purchase of Twitter in 2022, emphasizing the perceived absurdity of the offer and maintaining a strong public stance against Musk's bid[1][2][5].
- Legal and Strategic Considerations: The rejection also reflects the legal disputes between Musk and OpenAI. Musk has criticized the company for deviating from its non-profit mission and even sued it. The current bid could contribute to further legal complications, and Altman may be cautious about accepting an offer that could exacerbate these legal issues[3][4].
After Altman's sarcastic tweet, there were speculations about Musk's next move. sam altman, in his efforts to maintain OpenAI's profitable direction, may consider seeking backing from other notable investors beyond Musk's consortium.
