Sam Altman To Return As OpenAI CEO: Here’s What Happened

OpenAI co-founder Sam Altman is set to return as CEO of the generative AI technology leader, an $86 billion startup. OpenAI has confirmed reaching an agreement in principle for Altman's comeback, with a new initial board including Bret Taylor (Chair), Larry Summers, and Adam D'Angelo.

"We have reached an agreement in principle for Sam Altman to return to OpenAI as CEO with a new initial board of Bret Taylor (Chair), Larry Summers, and Adam D'Angelo. We are collaborating to figure out the details. Thank you so much for your patience through this," OpenAI stated.

Altman's return follows his unexpected dismissal by a board comprising Adam De’Angelo (Quora CEO), Ilya Sutskever (OpenAI co-founder and chief scientist), Tasha McCauley (former GeoSIM systems CEO), and Helen Toner. The firing sparked a significant backlash, with over 700 OpenAI staff members threatening to resign. Concurrently, Greg Brockman, OpenAI co-founder and board chairman, also decided to leave after being removed from the board.

“I love OpenAI, and everything I’ve done over the past few days has been in service of keeping this team and its mission together. when I decided to join Microsoft on Sunday evening, it was clear that was the best path for me and the team. With the new board and with Satya’s support, I’m looking forward to returning to OpenAI, and building on our strong partnership with Microsoft,” Altman said in a statement.

The board had initially questioned Altman's candour without presenting solid evidence of misconduct. Microsoft, holding a 49% stake in OpenAI, along with other investors like Tiger Global, Khosla Ventures, and Thrive, played a key role in advocating for Altman's return.

In the interim, Mira Murati, OpenAI's CTO, and later Emmett Shear, co-founder of Twitch and a YCombinator alumnus, served as temporary CEOs. Microsoft, meanwhile, signaled a new venture with Altman and Brockman, inviting resigned OpenAI employees to join.

The employee resistance, including a demand from the majority of OpenAI's staff for the board's resignation and Altman's reinstatement, escalated the situation. Ilya Sutskever, previously supporting Altman's dismissal, expressed regret over his decision.

Nadella, who had announced that Altman and Brockman were joining Microsoft, admitted that the deal wasn’t closed but he ensured that Microsoft would be working both with OpenAI and Altman one way or the other. He also revealed that Microsoft was going to demand major changes in the governance of the OpenAI board which is a non-profit and doesn’t have anyone who holds equity in the organisation.

Following backchannel discussions led by Shear, a reshuffle is imminent, with Toner and McCauley leaving the board. The interim board, chaired by Bret Taylor and including Larry Summers, will be tasked with forming a new 9-member board to overhaul OpenAI's governance.

Altman is poised to regain his board seat, with Microsoft gaining representation as well. “We are encouraged by the changes to the OpenAI board. We believe this is a first essential step on a path to more stable, well-informed, and effective governance. Sam, Greg, and I have talked and agreed they have a key role to play along with the OAI leadership team in ensuring OAI continues to thrive and build on its mission. We look forward to building on our strong partnership and delivering the value of this next generation of AI to our customers and partners,” Nadella stated.

Many believe this could be a great outcome for Microsoft as it tightens its grip over OpenAI without the regulatory and financial risks.