Sam Altman FIRED - The OpenAI Betrayal Explained

Shaan Puri

911, what's the state? What's the state of your emergency? Hey, the tech industry got flipped upside down over the weekend. I was staring at my phone the whole time. I haven't been so invigorated by any story in like 5 years. My wife might divorce me because I haven't looked up from my phone. I've just been on Twitter all weekend. Sam, how are you doing right now with this OpenAI story?

Sam Parr

It's been awesome. The real winner through all this is Twitter. Twitter's been great for this, right? Twitter just thrives through all types of controversy.

Shaan Puri

Twitter, aka the Silicon Valley group chat, has been **awesome** all weekend.

Sam Parr

it's been awesome

Shaan Puri

I thought there was a chance that you were just out duck hunting. I would come on today and you'd be like, "What happened?"

Sam Parr

I'm a Sam Altman fan. I've loved this guy; we've talked about him for years. I'm a big fan of his. This is... and I love drama. I love gossip. I read TMZ every day, and now I've got TMZ on Twitter. It's awesome! Of course, we're talking about OpenAI and Sam Altman getting fired. We're recording this on Monday; he was fired on Friday. But there's news happening in real time, constantly, right?

Shaan Puri

Exactly. Just as of an hour ago, there's news. So, we don't know exactly where this is going to all land. We're going to try to get this out as soon as we can. We had a whole other episode planned for today, but we canceled it. We just said, "Let's do this right now." What's our reaction? What is our reaction to the OpenAI stuff that's going on? Alright, Sam, where do you want to start? I think we should take this character by character, go through all the players that were involved, and I think we should give them kind of a grade. They can get an A or an A+ if they came out a big winner here. You could get a C, or you can get an F. I think we should grade all the players on how this has turned out for them in the 48 hours since this happened. But do you want to first give a little timeline summary recap?

Sam Parr

Yeah, so I think you should do it because you've been paying attention to it more closely. But it all started Friday at like, what, 3 o'clock?

Shaan Puri

Exactly. Friday afternoon, I get a text message from Ben Levy. He just says, "Wow, Sam Altman! What the fuck? Holy shit! What?" But he doesn't say the news yet, and then it'll...

Sam Parr

the worse

Shaan Puri

What? And then he's like, "Sam Altman out," but he misspells "out." Then he does the star sign... out of what? Where is he out of? It was unfathomable that Sam Altman would get fired, right? Like, in the same way that you don't expect to wake up and see that Elon Musk has been fired from Tesla. You don't think, you don't wake up and think that Sam Altman's gonna get fired from OpenAI, which is the hottest private company—probably the most important startup in the world—that has gone from $0 to $90 billion valuation in just a couple of years here.

Sam Parr

Yeah, it was shocking. It started because OpenAI... I don't even know why our guy put this in military time. So what's this, 2:48? At 2:48, OpenAI announced a leadership transition. They said that Sam Altman is departing as CEO because he was not consistently candid in his communications with the board. Their CTO, a lady named Mira, is becoming the interim CEO. A little over an hour later, Sam Altman said, "I love my time at OpenAI. It was transformative for me personally," and that he's excited for what's next.

Shaan Puri

Well, let's pause there because the first phase here is **wild speculation**. So, speculation is, "Oh my God, shock and speculation!" I can't believe this happened.

Sam Parr

like an april fools joke

Shaan Puri

It must have been something bad, dude. You know, he must be... this was a fraud. Did they unleash AGI? Was there a huge privacy leak that is causing him to have to step down because there's a security issue that he overlooked? Is this... there's like this accusation from his sister about sexual assault when they were kids. Is it because of that? Everybody assumes it's gotta be the worst until one hour later... or when is it? One hour later? Yeah, I think a couple of hours later, Greg, who was the chairman and essentially his co-founder of OpenAI, the lead technical guy at the time or in the early days, sends this message to the team: "Hi everyone, super proud of what we built up starting in my apartment 8 years ago. We've been through tough times and great times together, accomplishing so much, doing what should have been impossible. Based on today's news, I quit. Wishing you all..."

Sam Parr

with the I lowercase the lowercase I

Shaan Puri

And so then now we enter **Phase 2**. Phase 2 is... wait, Greg's on the board. Wait, Greg is a stand-up guy. If it was something really bad, Greg would not have just quit with him. This must not be as bad. Is there some kind of power play, jealousy, or a coup that's happening here? Is Sam being wronged? Instantly, I see the court of public opinion shift. The court of public opinion says, "Look, if Sam did something really messed up, Greg would not have just followed him out the door and quit unless Greg was in on it." So, there's still a possibility. More likely, it seems like Greg doesn't stand for this reasoning, so maybe we don't stand for this reasoning. All of a sudden, you see the **Sam Army** come forward. People who are startups from Y Combinator, when he was the president of Y Combinator, saying, "Look, I don't know what happened here, but Sam went to bat for me." So many stories came out that were all the same variety. I don't know if you saw these; they were all the same variety. It was a startup saying, "We had a time when we were screwed. I emailed Sam to be like, 'Hey, here's what's going on, blah blah blah.' Sam quickly replied with just something like, 'Hey, make sure you're communicating or, you know, just do your best. There's only what you can control.' But behind the scenes, he went to war for us. We found out later that he called all of our investors, threatened to dangle them over the balcony if they screwed us, and he saved our asses. He didn't even mention that he was doing that; just in the background, he went through and saved us. We found out later that this was true. So, I don't know what happened here, but you know, I ride with Sam.

Sam Parr

Well, an equally big deal is that one time I had a customer service question. I DM'd him, and he replied. He solved it for me, so exactly, and all.

Shaan Puri

A lot of it was he replied fast. He replied when he didn't have to. He vouched for us when he didn't have to.

Sam Parr

He man... he did. By the way, that was not a joke. He did reply to me. I had an error; I couldn't figure something out. I was like, "I'm just gonna DM Sam," and he replied with... he solved my problem. But yeah, the guy seems like a great guy.

Shaan Puri

And his brother comes out and says to all the people that are gleefully hating today, "Please know you're betting against the wrong guy." Okay, so that kind of foreshadows Act 2. Act 2 is the weekend. On Friday, you get the crazy news dump. Now, over the weekend, you have news that even people inside the company start to stand with Sam. They say, "If there was something bad, tell us what it is. You don't have to say it publicly; say it internally." What does it mean? He wasn't candidly consistent or consistently candid with the board. What did he lie about? How bad was it? You're taking our leader, our two leaders, out now. And wait, who is the board? The board is like this combination of people who have no connection to the company. They didn't build this; they don't even own equity in this, but they're deciding our future. The board is basically one legit technologist, this guy Adam DeAngelo, who was the co-founder and CTO of Facebook back in the day. Then he co-founded Quora after that. So you have Adam, a legitimate character in Silicon Valley, and then you have a bunch of other people that nobody's ever heard of. One of them is like that actor's wife; she's, you know, an academic somewhere and has never had a job.

Sam Parr

justin gordon levitt

Shaan Puri

Yeah, exactly. You know the guy from *Inception*? You know, like, great. The guy from *Inception*, not Leonardo DiCaprio. So that's the first, and not even him.

Sam Parr

he he's not the one on the board

Shaan Puri

not even him exactly so you got like you know you got her you got a couple other characters here but nobody that is again no equity no skin in the game and no track record building or operating you know complex companies so that seems a bit weird they're getting no data and rumors come out sam's gonna have a new company by monday sam and greg are gonna create an openai competitor by monday which is just like a pretty badass threat to throw down and so once the team starts to say they start to tweet out these emoji hearts saying I basically I stand with with sam I don't know all the details but if you don't come out with any details explaining why you did this I'm I'm gonna probably leave with sam and so the board starts scrambling and they start trying to renegotiate with sam to maybe bring him back and his conditions are like cool I'll come back y'all all gotta resign and clear my name you gotta bring back greg and we're gonna put a put a new board together that's like the board of my choosing the board doesn't wanna do all that and so they're kind of stalling they're going back and forth he goes back to the office with a guest pass on his badge and he says this is the last time I'll ever enter this office with a guest pass and then at the last minute we hear the news the the news come out it looks like sam's coming back and then sunday night it hits there's a new ceo in town emmett scheer my former boss the former ceo of twitch is now suddenly these the guy for openai sam is out he's in shock that that was like you know what I thought was the end and before I went to sleep thinking okay we're gonna record the spot I thought that was the end emmett releases an announcement on twitter saying basically like hey hey I'm here here's my 30 day plan I wake up this morning and there's more news 600 of the 700 employees of openai have signed a petition saying if you don't bring sam and greg back and all resign we're all leaving 600 of 700 it was actually 500 as of 3 am and then it got to 650 as of as of right before recording this that's basically a 100 people woke up and also signed the pledge including by the way the guy who was supposedly behind the entire coup ilya the main technologist the scientist who was the on the board who who was the guy who sent sam a Google meet link and was like hey could you join this right quick and sam's like sure let me just pop up let me just get my microphone and he pops on and then gets fired the whole board is sitting there and they executed his ass ilya comes out and signs the pledge and says I'm sorry for what I did what

Sam Parr

and even tweets out he goes like I wanna get the band back together and make it right I'm sorry

Shaan Puri

Oh yeah, I regret what I did. You know, we'll try to right the wrong. Then, on top of that, before that thing happened, Satya Nadella, the CEO of Microsoft, comes out and says, "Hey, we still support OpenAI. Sure, look forward to meeting the new guy, Emmett." It's just a really funny way of putting it because apparently they were not consulted and were only told one minute before the firing happened, or one minute before the press release went out, that Sam was fired. They were blindsided, even though they agreed to fund $10 billion into this company and own 49% of it. Then he says, "Oh, and good news! Sam and Greg now work for Microsoft." This is just like the ultimate checkmate move because, Sam, I don't know if you know this, but Microsoft not only owns 49%, but they also provide all of the funding that OpenAI requires to exist. They could pull that at any minute now because a lot of that funding is in compute credits—basically server credits. But not only that, they also have the license to all the technology. They have the model, the weights—they have everything they need to basically hand Sam and Greg all of the code and say, "You don't have to start from scratch. Here you go." In the end, they got everything. They got everything they wanted: the team, the technology, the money—they got everything.

Sam Parr

The most interesting part of all this, though, is the characters. Everyone keeps saying this is "Succession" in real life, and it is. It's one of the greatest things to happen in Silicon Valley in the last 15 years. It's a beautiful storyline. We thought Sam Bankman was a gift from the gods in terms of podcasting, but this is actually, I think, more interesting. It's not played out yet, so the story's still going to keep going. But let's talk about the characters. Let's start with Sam Altman. We've talked about him a ton, but this guy's background is fascinating. He's from St. Louis—my hometown! Shout out to St. Louis! He then moved to Silicon Valley to join Y Combinator at the age of about 19 or 20. He started a company that had mild success; I think it raised a fair amount of money and sold for $50 million, of which he walked away with $5 million at the age of 21. Using that $5 million, he parlayed it into $100 million by investing in things like Airbnb and Dropbox. Because he worked at Y Combinator, he eventually became president of Y Combinator at the age of 27.

Shaan Puri

**Two quotes from Paul Graham about Sam Altman.** Remember, Paul Graham is someone who invested in Dropbox, invested in Airbnb, and he has seen the founders. He knows everybody in Silicon Valley. He's met Mark Zuckerberg and all these guys. So for him to be most impressed by Sam Altman means something. He says, "Sam Altman has it. You could parachute him into an island full of cannibals and come back five years later, and he'd be the king." That's the first one. Then he goes on to say, "I met Sam Altman many years ago when he was 19 years old. He was a Stanford dropout." By the way, being a Harvard or Stanford dropout is the number one resume item. If you go to Harvard or Stanford and you don't drop out, you have intentionally chosen to not have the number one credential you could have, which is Harvard dropout or Stanford dropout. He says, "Within three minutes of meeting him, I remember thinking, 'Ah, so this is what Bill Gates must have been like when he was 19.'" In three minutes, I don't know what Sam Altman did, but I would love to know. I am fascinated by people who are special. They're the kind of freaks I love. You could see it in sports; you could see LeBron James at age 17 was like a freak of nature.

Sam Parr

Yeah, he had like the equivalent of a 42-inch vertical. You know, whatever he did, it was like an 8th grader dunking.

Shaan Puri

There's another story that's kind of remarkable. I thought this really tells you about this guy's character. So, Sam Altman is gay. He came out when he was like 15 or 16. I think you said something about him being from your hometown, St. Louis. There's some story that when he came out, not only did he just come out as a teenager—which alone takes some bravery—but he then hosted like a pep rally or something like that.

Sam Parr

He went to John Burroughs, which is in Saint Louis, where I'm from. Most high schools are either Catholic or some type of Christian. He came out as being gay, but he, like, created a club—some type of gay club. At a Catholic school, they were like, "No, we're not about this." So, I think he led a school walkout.

Shaan Puri

that takes a lot of like leadership yeah

Sam Parr

He's a very courageous guy. For like the last 15 years, pre-OpenAI, even though he was president of Y Combinator, he was still a little bit behind the scenes. Even though he was running this huge incubator and he's a powerful guy, it still felt like, "Well, why would Paul Graham say this about this kid who still has unfulfilled potential?" A couple of years ago, he starts working on OpenAI, and then all of a sudden, we're like, "Oh, alright, the guy was plotting." He's played the long game. Now we understand why everyone looks up to this guy. OpenAI has basically taken over the tech industry and went from 0 to, you know, one of the biggest companies in the world in what, 5 years or something like that?

Shaan Puri

Yeah, exactly. So, he leaves the most prestigious job in Silicon Valley, which is, you know, the President of Y Combinator. He's the Dean of Harvard. He quits suddenly because the nonprofit research organization he co-founded felt like the right opportunity. He did that suddenly; it was surprising. I remember at the time I had the thought—I've said this before here—that if Sam Altman just quit being the President of Y Combinator to go join OpenAI, how can I justify coming into work tomorrow? Why would I not also go to OpenAI? Whatever OpenAI is, I knew nothing at the time. But all I knew was that if one of the smartest guys in the world went and did that, maybe I should go do that too. Honestly, that would have been the greatest career move I ever made if I had done that because, you know, OpenAI quickly changed its structure from nonprofit to becoming a capped for-profit thing and became worth nearly $100 billion in a short time.

Shaan Puri

Of time creating ChatGPT, the fastest growing product of all time, to get to 100 million users faster than anyone.

Sam Parr

And let's go to his two partners. When he started it, there are a bunch of weird stories that aren't entirely out in the open. It seems like there was something where Elon Musk funded the business or helped fund it at first. He invested $40,000,000 and also helped to recruit and convince a few of Sam's co-founders to join. Is that right?

Shaan Puri

that's right so basically the when people say okay great sam is this he you drop him on an island of cannibals he comes out king okay cool but what's his skill what does he do and basically it was like on anything about strategy or ambition but this is what paul graham said he said if there's if there's ever a question on strategy or ambition I default to what would sam do and you know paul graham is like 20 years older than sam saying that so that's kind of impressive so what did he do he basically has a conversation with elon musk and the 2 of them shared the same belief which was that artificial intelligence was gonna be a big deal that we would be able to one day realize agi which is artificial general intelligence think about it as you know superintelligence when when you know ai is generally smarter than than humans and kind of everything that we you know most of the things that we try to do so the they both said that's also kind of scary because we don't know what's gonna happen on the other side of agi so we should fund research in a nonprofit that will study you know fund the research around this so that we can safely create agi instead of having agi that kills us all like the movies so what sam did was he hosts his dinner in palo alto and you know he gets elon musk there and he gets a few other smart key people one of them was this guy greg who was at the time the cto of stripe which was before openai was the most impactful big startup in the world so he gets the cto of stripe he gets this guy ilya who's like the lead research scientist in ai at at Google essentially he's the kinda like one of the founding fathers of of of ai and deep learning and so they get a bunch of these people around the table and they basically reid hoffman is there and they basically like we need to do this elon basically just agrees to fund $40,000,000 into the nonprofit so elon puts his money where his mouth is sam you know helps recruit put the whole deal together puts brings the people together on the way home sam's like hey greg let me give you a ride back to san francisco so they drive back to san francisco and what greg says what sam says is the first 30 minutes it's an hour long drive from palo alto to san francisco so it's the first 30 minutes greg just asked me rapid fire like a 150 questions then the next then at the 30 minute.

Shaan Puri

He goes, "Okay, I've decided I'm gonna do this. I'll quit Stripe and I'll join OpenAI, whatever this thing is that you're creating. I will join it." So, for the next 30 minutes, they started making their plan. They discussed, "Okay, what are the first things we need to do?" This tells you something about Greg. To make a crazy career move like that, you need independent-mindedness and conviction in something that quickly. It also tells you something about Sam's persuasiveness and ability to put this thing together. Then, what Elon says is that he recruited Ilya out of Google, which was very, very hard to do. He mentions that it's the reason he and Larry Page, the founder of Google, don't talk anymore. You know, he used to be friends with Larry. Elon famously didn't own a house for a period of time and would just crash at friends' houses. He would crash at Larry Page's house all the time. Elon says that they got into arguments about AI. He was really worried about AI, while Larry was tech-forward and thought, "No, it's gonna be amazing." Then, he mentions that he got upset when Larry called him a "speciesist," implying that he was just all about humans. Elon responded, "What the fuck else am I supposed to be about? Are you not?" That scared him even more, prompting him to create OpenAI to defend against Google, which owned DeepMind, the number one player at the time. So, Elon and Sam poached Ilya out of Google, which took a lot of money and a lot of persuasion, I believe, to get him out. When he joined OpenAI, the research community that worshipped this guy basically followed, and they got all the top researchers to join. That is the founding story of OpenAI.

Sam Parr

It's amazing, right? I mean, this is like drama movie stuff. Just that dinner, that drive home... I mean, this is perfect. We're going to have to have Justin Timberlake star as one of these guys.

Shaan Puri

And so, this brings us to, I think, the second character that we should talk about: this guy Greg, who I believe is the unsung hero in this whole thing. Because Sam Altman is kind of like the hero, right? He’s the CEO. He gets backstabbed, he gets wronged, he’s the martyr. He had to suffer. People come out, and they’re all supporting Sam, sharing like it’s a funeral for Sam on Twitter the other day. They’re like, “Oh, I remember that once Sam responded to my customer service request,” or “Oh, I was on a bike once, and Sam, you know, he moved over in the lane so I could go by.” Right? Everybody was just sharing their favorite Sam memory. And then nobody’s really talking about Greg. Now, Greg, in my opinion, shifted this whole thing. Because at first, it was like, “Damn, I don’t know what Sam did. Must have been horrible, blah blah blah.” As soon as Greg came out and was like, “Yo, I quit,” and they’re like, “Greg’s the number two. He’s on the board. He was the chairman of the board.” I think they’re like, “If Greg doesn’t think this was right, I don’t think it’s right.” And so, Greg single-handedly shifted the perception of the narrative around this whole thing, and the board didn’t counteract that. I think Greg was the real hero of this. What I did was, there are some amazing blog posts that anybody who’s a real nerd about this stuff, if you just really love kind of like the lore, the canon of Silicon Valley, you gotta go read this. Greg has blog posts up on his blog about the early days of OpenAI, and I think he blogged...

Sam Parr

early days of openai last week

Shaan Puri

No, this is eight years ago. This thing started a long time ago. He talks about how they didn't have an office. He said, "Alright, just come to my apartment." He described how there were four of them in the apartment. He mentioned that he didn't know anything about machine learning, so he did two things. **Number one**, he asked Ilya, "What is the number one textbook about machine learning?" He bought it and studied it religiously. He read everything there was to know about deep learning and machine learning. He goes on to say that this is the former CTO of Stripe. He's not just some non-technical dude; he's known as one of those incredible 10x or 100x engineers. He said, "I didn't know anything about deep learning, so I just dedicated myself to read page one, chapter one of the book. I'm going to take notes and ask a ton of questions." **Number two**, while these guys were setting up their research stuff, he did everything else. He would say, "Oh, your back looks a little uncomfortable; you need a pillow?" or "You guys thirsty? I'll go get smoothies." He was doing all the intern grunt work those first few months to get them set up. He explained that it was basically alternating between research doing something and then getting blocked. He would ask, "What's blocking you?" They would respond, "It's taking forever to run this training set," or "I have to organize this data." Then Greg would stay up all night and do the engineering because people don't realize that engineering and coding are very different from AI research. He would do the coding that made the researchers go faster. He built basically all of the infrastructure so that researchers could do great work. Even with GPT, there was a story where they ran the model, and the output was kind of mediocre. Then Greg locked himself in a room for two weeks, and when he came out, suddenly GPT worked. They were all like, "What the hell just happened?" He said, "Yo."

Sam Parr

I'm out

Shaan Puri

And you know, I did that. He has these great blog posts and photos of those early days that I thought were kind of amazing.

Sam Parr

So, Greg was born in '89, which puts him around 34 years old now. He joined Stripe in 2010 and became CTO in 2013. So, he was CTO of Stripe when he was about 24 or 25 years old. Then he left Stripe to co-found OpenAI, so he was only 26 or 27 when he started working on OpenAI. It's pretty amazing; these guys are freaks.

Shaan Puri

unreal

Sam Parr

It's wild. It's unreal. And by the way, what did you give? You forgot to give a grade. So, Sam Altman, he's going to win no matter what in all of this.

Shaan Puri

I so I think he was gonna get like let's say a b + right he was gonna get a b + why because you got fired you got back stabbed by your own your own people that not not great not a great thing to happen 2 they haven't said what you did but you did something right they weren't just gonna fire you for nothing so like you did something we don't know what it is unknown okay I can't give you an a for that it looked like he was gonna get the job back which would have been great but then he didn't so it didn't come it didn't didn't happen in the end so even though you got some some support from your team it didn't happen until the Microsoft thing happened which was literally like imagine playing a game of chess and you're like oh I think I got this guy you know I have a 5 piece to 3 advantage here his queen is out and then you look up from the board and he's holding you know a glock to your head and that's what happened to ilya here but basically it's like he's now he's at Microsoft they have the license to all of the technology they have all the training data in the world because guess what 90% of computers are pcs that run Microsoft that run you know windows he has all the funding in the world he got paid I'm sure there's you know like satya had to bring sam and greg in before the stock market opened on monday just to kind of like not have this be an issue for Microsoft that they got screwed here they put a bunch of money into the into a into a lame duck and so he got everything he got the tech 600 of 700 people follow are saying they're gonna follow him there so he got the team he got the money he got the funding and he got it all in 48 hours and they and they were basically like yeah they're gonna lead a new subsidiary of Microsoft that's gonna do open that's gonna do great research on ai it's like oh you mean open ai part 2 so so now he has to walk away with an a + right like you can't yeah you can't knock that and well and he's he's got the good guy label unless they come out with some new information that's that shows that he did something effed up which something has to come out

Sam Parr

There are only three options, in my opinion, for how the story for Sam ends. **Option A** is that it's an unforgivable sin. I think that is not likely, but it is possible that what he's done is just, "Well, you're done." **Option B** is that he goes back to OpenAI and becomes CEO. I think that is more likely than not going to happen. **Option C** is that he stays at Microsoft, and I think in a decade or five years, he becomes the CEO of Microsoft.

Shaan Puri

yeah which is now worth $5,000,000,000,000 or something at that.

Sam Parr

Yeah, we're right now at a trillion today. So he's going to turn out okay. Now, this other guy, Ilya, he looks like a schmuck here. He looks like a loser.

Shaan Puri

ilya gets an f

Sam Parr

He gets an F. There's a little bit of likability with him where it's like, "Oh, you're just a brilliant scientist-artist who was manipulated here because you're just a scientist and you don't understand human interaction." Well, we should explain.

Shaan Puri

so we should explain one thing which is what are the possibilities of what sam did that might put sam in the wrong or illy in the right so there is what you're calling the unforgivable sin which I would say by the way not a great track record of anything being unforgivable let's say the really bad personal stuff could be the could be one reason why in which case I would say that's a completely fair reason to remove him if they did an investigation found out that that was true that they're in the right for removing him that's defensible but they just haven't said anything reason number 2 is safety concern so ilya is famously like the reason he's doing this is literally he's worried about agi he doesn't want the world to end and what initially people thought was sam says all the right things about safety but also sam is like a you know capitalist he's a entrepreneur he's he he's a he's a hard charging guy and he's running forward here and maybe they're saying slow down he's saying no we don't need to slow down and they're saying sam this is too risky and he's saying no no no this is not risky we gotta move forward that's what it looked like the situation was and it was made crazier by the fact that I don't know if you saw this he did an interview the day before and he said something like this he said I've been lucky to be in the room 4 times now the last one was just a couple weeks ago where I saw something that pushed the veil of ignorance forward and the frontier of techno technology to us and like it pushed the veil of ignorance away and the frontier of technology to us so basically he's saying like there's been like 3 or 4 mind blowing moments you know about ai I've been lucky enough to be in the room the last one happened a couple weeks ago just wait till you see this it's gonna stun people and so some people are like yo did they like create the monster super intelligent like did they create agi you know has agi been achieved internally and he like randomly posted on reddit not long ago agi has been achieved internally as like a joke I guess so some people said maybe they've stumbled into something and this guy's going too fast and it's you know like the scientists you know around the nuclear bomb saying no no no we gotta like destroy this thing or we gotta like slow down this is getting too crazy that would have been the other reason which would have been again defensible especially given that openai's charter is specifically says we're not about increasing shareholder value we are about you know safely building agi to benefit all of humanity so that is their charter and if they thought this guy is moving too fast putting that at risk I would say they are completely in the right to do so if they believe that to be true the bad part is again they've come out with no evidence that that that is the case they haven't explained themselves so nobody believes them that that's true the third reason so you know you have the really bad thing you have the safety argument and the third thing is essentially it's just a power play they're annoyed by him they don't feel like he listens they feel like he's getting all the credit or he wants fame and fortune and power play let's get this guy out of here and we will we get to run and own this thing and that's like a jealousy driven thing and I don't know which of those is the most true I don't know what you think but you know it seems like the you know none of those are perfect explanations

Sam Parr

I think I'll say what I think maybe later, but it's number 3. I think it's number 3. Let's talk about... let's come back to the board, but let's talk about Emmett Shear. You are one of the handful of people, or however many people, who have had a relationship with him and understand. So, last night at 1 AM, Emmett basically said, "I've been the guy that's been picked." He put out this really good tweet where he explained what he was doing. The funniest part, I thought, was he's had the job now for 12 minutes, and he did a wonderful job of saying the word "our." He goes, "Our products are going to be this. Our team is going to do this. We are going..." It reminded me of that meme where there's a guy who goes, "Hey, I made this," and he hands it to a stick figure. The stick figure goes, "You made this?" Then the first guy leaves, and the stick figure looks at the thing and says, "I made this." It's the whole thing about on the internet where people steal stuff. I actually think Emmett's a great guy, so I'm just messing around. But I thought it was amazing how he's like, "12 minutes later, this is our company, and it's going to do this." What do you think about Emmett in this role? He's been getting a lot of criticism because he previously shared online that he thinks, "We need to slow things down." A bunch of people are like, "This is ridiculous, don't slow down," whatever. But he seems like a really thoughtful, great CEO. Am I wrong?

Shaan Puri

So, Emmett, you're right. I worked with Emmett for about two years. I got to sit with him in hundreds of meetings and see how he thinks. I also hung out with him, had beers, and just talked to him. He came on the podcast, and I talked to him for an hour there about...

Sam Parr

ai stuff you always said he was really thoughtful

Shaan Puri

He's extremely intelligent in a broad way. Most people are not that intelligent. You meet some people who are, you know, above average, and then you meet some people, as you say, "the oven burns hotter." It's just very clear that he's got more horsepower in his head than most people. I think that's great. As much as we like to say that hard work is what matters, you know what also matters? Intelligence is also a really strong attribute. It's like, you know, Steph Curry's got great skills, but LeBron is 6'8", 250 pounds. Size and speed matter.

Sam Parr

I hate when people downplay intelligence. I'm like, guys, let's just admit some people are born smarter, just like some people are 7 feet tall. There's a reason why 20% of Americans who are 7 feet tall and below the age of 30 are in the NBA. You're just better at that particular thing, right? And the way that...

Shaan Puri

Height helps you with basketball; intelligence helps you with running companies, right? Like, that's the thing. So, Emmett is extremely intelligent. He is among the most intelligent people I've ever met. That's the first thing. The second thing is he's got depth and breadth. A lot of people are really, really intelligent in one specific domain. It seems like this guy Ilya might be one of those, where he's just extremely, extremely technically intelligent. But it seems like in the game of soft power, politics, and dealing with people, he had a pretty boneheaded way of doing things that didn't work out. To quote him, "I deeply regret what I did. It was handled very poorly." So, you know, some people get really, really smart in one technical domain, but they don't have a breadth of intelligence. I would say that Emmett is wide and deep. He's technically very strong. He was a great engineer who built Twitch, one of the best live streaming products. It was him and this guy Kyle. Kyle went on to build self-driving cars, and Emmett ran Twitch for like, whatever, 18 years or some shit like that. So, you know, between Justin TV and Twitch, he's very good technically, which is important because it's a deeply technical product. He said to me, when I was talking about AI, "Yeah, like once you understand how transformers work..." I was like, "Well, let's stop there because I have no idea how transformers work." He said it like, "Yeah, it's easy. I mean, just once you get how transformers work, it's like, you know, blah blah blah. Just anybody could go watch a video."

Sam Parr

We've had a couple of smart people on this podcast, and they've tried to use analogies because I'd be like, "I don't understand what you're saying." They're using an analogy, and I'm like, "Can you please use an analogy for your analogy?" I think we had a biologist on here, and he was referring to the Battle of the River Thames in World War II in order to describe crypto. I'm like, "Guy, I don't know what the Battle of Thames was. This doesn't make sense to me."

Shaan Puri

Right, exactly. You know, I'm asking for a lunch bowl over here and you're making gourmet.

Sam Parr

like I

Shaan Puri

let's let's do this right

Sam Parr

what what's his soft skills like

Shaan Puri

well his soft skills I I would say when I experienced him which was like you know whatever he's been he'd been running the company for over a decade as ceo I thought he was good not great so for example I think he always knew what to do like if you caught him when he was calm he would give great advice on the people side of how to handle something however in the heat of the moment he was prone to falling it falling into like debates about semantics about words about data that would make people feel like shit and he would like win the battle and lose the war type of thing with people and so I don't think he was great with that but I also think twitch was like a bunch of very like kind of it was a community product with a bunch of very like sort of woke people at in the company that were like very touchy feel about stuff you know I think openai is gonna be his type of people you know like emmett was better in meetings where all the people were engineers and product product people he was worse the more that the people were you know we got legal pr cobs you know marketing you know those meetings went worse for him I thought and so I think he'll have less of that here but he also is like biology like he'll reference the battle of the bulge like he'll reference you know well the judicial system in ireland back in the 1500 what they did was really interesting it's like dude why do you know this he's like well I've read about all the judicial systems I was very interested in how how governing has changed over time it's like that's your casual reading he's like yeah like I'll just I I don't know is that not is that weird and it's like you know somebody's really good when they when they don't even realize it's weird when the thing they do is like really fucking weird and so he's has a very very wide set of knowledge now he's getting kind of labeled as a a decel I don't know if you've seen this like a decelerationist meaning like somebody who wants to slow things down because as soon as he's got names basically a suit yeah so kinda like a suit or like a a doomer you know like oh this is this guy's anti technology which is pretty silly and it's like you know if he could be technology he would you know like he he he's a technologist through and through

Sam Parr

they're they're calling the guy who invented twitch a a boomer basically

Shaan Puri

Yeah, it's stupid. A mutual friend described it well. They said, "Because people dug up all his old tweets, if OpenAI is at a 10 right now in terms of speed, it should probably be at like a 1 or 2." You know, you just don't want this cat to get out of the bag. So, I want to read you what he said on our podcast when he came on to discuss AI. I asked him very simply, "Is AI gonna kill us all?" He goes, "Maybe." I said, "It's interesting you say maybe it's gonna kill us all because you're pretty pro-technology and everything. You're an optimist." He replied, "Well, it's because I'm an optimist that I'm scared. If I was a pessimist, if I was like, 'Oh, this AI thing's overhyped, this technology is not that impressive, it's just a nice little magic trick, it's nothing real underneath it,' if I was pessimistic, I would be less worried. I'm optimistic. I am extremely impressed with how these work, and I see a pathway where this is gonna get better very fast."

Shaan Puri

It's gonna be able to self improve that's very scary because we don't know what happens on the other side of that he's like it's because I'm optimistic then the second thing he said was he goes here's the analogy you know in biology there's like there's now like ways that you can synthetically do things you can we know we can edit genes for example and we can like add an extra leg to a sheep or we can like modify a virus this was like you know covid right like you could modify a virus and make it more spreadable and we all saw with covid how dangerous that capability is that like this thing you know if it's leaked from a lab that's really really bad like you know that that was a big mistake that technology made that like you know fucked up the world for a few years and so he's like you know we have regulation I think everybody kind of agrees we should maybe not go super fast and make it easy for somebody to like print smallpox in their home right like we should maybe not give that capability to everybody and maybe we should like slow down to make sure there's some oversight to so so that we don't do something really bad that like creates a super virus he's like people get that when it comes to biology they don't really get that when it comes to ai he's like with ai here's the thing ai is really good at like the one thing you need in order to be really good at ai at developing ai he's like ai can code it can write code it can read everything there is to know about a subject in an afternoon become absolute world expert at it and then it can translate that into action it can it can translate to writing code it can also design chips yeah it doesn't do either of those 2 things perfectly right now it's not it's not amazing at writing code and it's not amazing at designing chips but it can do them it's it's within the zone of things that ai can be good at the type of things that ai can be good at which means that over time it's gonna be able to write code that designs ai and write you know and design chips that make ai better and once that thing can improve itself it's gonna get fast it's gonna get really amazing really fast faster than anyone can expect and maybe that's a good thing maybe it all works out but also maybe it doesn't and that's like he's like even if I think the probability of a really bad thing happening is low it's the consequences are so bad we're not just talking about like a virus that's kind of like screws up your computer or like gets like you know even like a pandemic that gets people sick we're talking about this could destroy like he says like we could destroy all of the value with the light cone which I don't even know what the light cone is but I don't want that right so he's describing like even if it's low probability we should just be really really careful about that and like make sure we don't screw the whole thing up and a friend reached out to one thing they go they go everybody's saying like emmett's gonna wanna like slow this down and stop it he's like no no emmett's smart emmett knows the the game theory of this the prisoner's dilemma if you go too slow somebody else will create agi before you because you you slowed down to 0 so somebody else will get there before you who may not share your moral beliefs around safety so you can't go too slow where other people get there first who don't share your your safety views but you can't go so fast that you don't actually build it safely there's a middle ground to seek and so and I think that's the best description of this where people are trying to label him as one thing and knowing what I know about him that's just not true

Sam Parr

Well, let's go through a rapid-fire session of some other story points. We'll make that quick. Also, we've been discussing what we think is going to happen. Here's a quick story for you, if you'd like to throw it out.

Shaan Puri

a final grades before we do stories final grades so the the board what do you what do you grade in the board

Sam Parr

oh they're fucking losers they're the worst they they look horrible they're gonna get you got an

Shaan Puri

f like if it stands for fucking loser yeah yeah

Sam Parr

Is there an F? They're the worst. I mean, it doesn't matter what the truth is; it's all about perception. They look like the worst, including Adam D'Angelo, the founder of Quora. Right now, he looks horrible. So, if they get an F, do you agree?

Shaan Puri

yeah agreed emmett what do you give emmett he's 12 minutes onto the job here

Sam Parr

He's actually... it's actually like a D or a C at the moment. He's getting dragged, I think, which isn't fair. But no, he looks like he's a loser here because of perception.

Shaan Puri

right and what about taking

Sam Parr

The hero's job, like, it's hard to look good regardless of how amazing he is, right?

Shaan Puri

right and what about satya Microsoft

Sam Parr

He gets a B. He looks pretty good. I mean, he's the man. He's kind of made a resurgence for Satya or for Microsoft. I think there's a real world where Bing actually catches up to Google in terms of search, and Microsoft is going to become an even bigger company than they already are. So yeah, I mean, he's a... he and Sam are the masterminds.

Shaan Puri

I gotta give it an A+. The dude, you know, mobilized over the weekend and before the markets opened, he had basically acquired OpenAI for negative $100 billion. He *acquihired* OpenAI, which is incredible. Now, man, he got OpenAI out of the nonprofit capped profit structure. It's just super for-profit inside Microsoft. He got the key talent, you know, Sam, Greg, all of the key people—600 of the key people. Now they just own the whole thing instead of 49%. That's an A+.

Sam Parr

he crushed it on this one he he's the man

Shaan Puri

so let's do let's do the the story lines

Sam Parr

yeah here's one quick story line have you heard of fairchild conductors do you know what that is

Shaan Puri

I've heard of it, but I'm not a history guy. So, what's the story? Isn't there something like the "Traitorous Eight" or something? What is that?

Sam Parr

Yeah, so basically, there was a big company called, I think it was called Shockley Conductors. They made computer chips in the sixties in Silicon Valley. People were pissed off at the guy who owned it, William Shockley, I think his name is. He was brilliant but just a pain in the ass. So these eight guys said, "Hey, you gotta bail or we're bailing." The CEO goes, "See you." And so these eight people went and started Fairchild, which was basically the equivalent of like NVIDIA back then in 19...

Shaan Puri

they basically first silicon valley right that was like the that was the seed round of silicon valley

Sam Parr

Yeah, and they were famous because their culture was casual. It was a place where nerds could come and be casual, and where the best ideas actually won. That was where the whole culture of Silicon Valley arguably started. The offshoot of Fairchild Semiconductor was basically IBM. IBM was founded by one of the founders of Fairchild, Andy Grove. He was the famous manager and I think he was the CEO of IBM. The founders of Sequoia Capital and Kleiner Perkins might have spun out from there. There were just all these people involved. The story of the "Traitorous Eight," as they're called, is very similar to this story. If you're interested in this type of stuff, you could actually go and read that book. You would see a lot of similarities between what is going on now. So this is like our version of that, and I think it's going to end well for Greg and Sam because it ended really nicely for the Traitorous Eight.

Shaan Puri

right

Sam Parr

so that's an interesting thing that they can do

Shaan Puri

Is that they unwind this whole thing and revert back to OpenAI. By the way, that's my prediction. It hasn't happened yet, but I think the final step now that Ilya signed the pledge, being like "I quit and I'm also gonna go work there," is: what is the point of even having the OpenAI entity if 600 of the people, including all of the leaders, are gone? I don't think they want to be inside Microsoft necessarily. So I think this was the final straw. I bet by the end of the day today, they get a "whoopsie daisy" undo on the whole thing. Sam is back as CEO of OpenAI, and the board quits, and they get a new board. That's my prediction, by the way.

Sam Parr

and I think

Shaan Puri

doesn't make sense

Sam Parr

I believe that prediction is the same. I think there are long-tail predictions here, which is that new startups aren't going to want to have a board of directors. I actually think that's the wrong takeaway. Brian Halligan from HubSpot wrote, "No, the takeaway shouldn't be to not have a board; the takeaway should be to have a good board." I think that potentially, the governance structure of companies might actually change significantly. People are going to have PTSD from just hearing this story, and that is going to have downstream effects that are quite large. In a weird way, it could even impact the venture capital industry. I think that is a real possibility.

Shaan Puri

I totally agree, and I think it's so stupid. Right now, there are so many startups that are reading their governing documents about the board and thinking through, "Do I need to change my board?" Here's my public service announcement: **Don't worry, bro. You're not OpenAI, you're not Sam Altman, and your board is also not these schmucks either. Nobody cares.** For a startup, don't worry about your governance structure right now. You should be doing these standard, vanilla things: put competent people there and then don't worry about it too much. You need product-market fit. You don't have this problem in the same way that, when you hear what's going on with Uber or Facebook, it's like you're not Uber and Facebook. You don't have the same problems that they have. **Don't suddenly start spending your energy over there and take your eye off the actual main problem: you need product-market fit, you need growth.**

Sam Parr

I think the takeaway here is that OpenAI's board was stupid. I'd say that was actually a strategic mistake, it seems like on Sam Altman's part. Also, I think the whole nonprofit shtick was stupid too. TBD [to be determined] if I'm going to be right on that, but as of now, it looks like it would have been a lot simpler if this was just a normal board where they have equity in the company.

Shaan Puri

A good board started with Elon Musk, Reid Hoffman, and all these legitimate players. Then, one by one, they all quit. Basically, Elon quit because things weren't going well; they weren't listening to him, and he took his ball and tried to run home. Reid Hoffman quit because he started a competitor. Another guy quit because he wants to run for president. In total, five of the original board members quit for different reasons, whether it was starting competitors, conflict of interest, or running for president. And this is what they got left with.

Sam Parr

Yeah, so hopefully that gets changed. What are any other takeaways? I think what we're saying about this was the best and the worst of us.

Shaan Puri

yeah that was kind of my big picture takeaway like I feel like this was the best of silicon valley and the worst of silicon valley all in the same weekend you know the best I thought was things like you know what greg did when he was like yo I'm out too I quit even though they tried to they they wanted to retain him they weren't firing him it's like yeah that's a real cofounder right that's that's a that's a ride or die sort of ducks fly together moment and totally I thought that was that was badass I thought that was the best of us and then I thought the worst of us was like this like stupid board that has no skin in the game that doesn't know how to communicate that didn't like handle this well just fumbling and bumbling and removing a founder from their removing basically the greatest founder alive you know outside of elon musk from their company that they created for what seems like no reason and if there is a reason you gotta like say it and even if you say it in a way that wasn't like doesn't get you sued like you know maybe that's why they're not saying anything but you have to at least tell your team you have to give more than what they did they handle it better than what they did and if it was so bad then don't negotiate with him to come back right like if it was that bad then he shouldn't have 24 hours later been in discussions to come back you know so the board I thought was you know was the worst of us I thought you know twitter was alive and popping and it really did feel like it was the silicon valley group chat that was kind of the best of us and the worst worst of it was like you know it felt like gossip girls all weekend and that's kinda lame and there's a bunch of you know like speculation and wasted energy and you know like I saw these twitter spaces going on for hours and hours of people just like discussing like you know it was a real housewives episode and they can't believe that jenna said that right like it just seemed like you know it wasn't it seemed like gossip and then I thought that was a waste of time you know I thought there was a whole bunch of things that were kind of like the best and the worst showed themselves in the same weekend you know maybe you know the it could be that there actually is a legitimate suit you know crazy safety concern and like this guy was going too fast and you know this ilya guy was maybe the hero and was pumping the brakes even though it screwed up the his own economics if he really was standing for something that he believed in right like it could be that it was that or it could be that it was a jealousy power play and and take him out right we don't know but I just thought there was a whole bunch of best and worst another one was like just this instant labeling like are you these like tribes like I don't know if you've seen this like e / a c c thing

Sam Parr

is that the e cell d cell

Shaan Puri

Yeah, babe, what is that? Basically, there's a whole bunch of people in the Twitter bio that hit "E/A/C/C." I've been seeing this for months, and I had no idea what the hell this was. But it's... you're an effective accelerationist, right? So it's basically like kind of a play on the effective altruism or whatever altruism that Sam Bankman-Fried was doing.

Sam Parr

that's pretty stupid I think

Shaan Puri

The one is basically like "pedal to the metal," you know? Tech forward, progress forward, technology optimist. And it's like that's the cool club to be in. Then, anybody who's saying, "Hey, slow down," you're a... which is like, you know, it's the "D" word basically. It's a slur, it's an insult. To me, this was again, it's the worst of us. It's like people in Silicon Valley make fun of politics. It's like, "Oh, I'm not left or right." It's not that simple. It's not Republican or Democrat. I don't fall into these stupid party, you know, tribes that are just blindly following the herd. And it's like we're doing the same thing. This "E-cell, D-cell" shit is the same thing as Democrat, Republican, red, blue, left, right. It's an oversimplification of a massive... an oversimplification of what's going on. So, I thought that was kind of the worst of us too.

Sam Parr

Final prediction: My prediction is that in the next 24 hours, all this is going to be undone and things will be back to normal. That's my prediction. Is that yours too? Maybe we'll give it 48 hours, but I think at this rate, 24 hours.

Shaan Puri

When I was in 2nd grade, my class had a field trip. They told the parents, "Hey, you need $20 to come to this field trip." So, my mom gives me $20 in the morning, and I go, excited about the field trip. I don't think I'd ever been on a field trip before; this was my first. They said, "Okay, put your things over here, sign your waiver, and put your $20." I'm looking around, and I'm like, "Where did my $20 go?" I was right at my desk, and it's not here. I'm looking under the table, on the desk, and I checked my backpack. I'm like, "What the hell? Somebody took my $20! I can't go on the field trip now." So, I go to the teacher and I'm like, "Miss, somebody stole my $20." She's like, "Oh my god! Stealing money from a kid? That's not okay." She's like, "Are you sure?" I'm like, "Yeah, I was right there." So, she turns the world upside down. She starts blowing the whistle and says, "Everybody sit down! Who has the money?" It's just silence; nobody raises their hand. She's like, "Okay, we'll try this a different way. I'm going to put a jar outside, and we're going to walk out one by one. I want the $20 to be in the jar by the time this is done. No harm, no foul." Everybody walks out, and then everybody walks back in. She comes back, and the jar is empty. Now she's pissed. She's like, "Okay, I gave you a chance to do this clean. I gave you a chance to do this publicly. Now we're not going on the field trip, guys. Guess what?" And I'm like, "Oh my god! This is crazy! Not just for our class." She tells the teacher next door, "We didn't earn this because one of our core values has been betrayed here."

Sam Parr

and where was the $20

Shaan Puri

And then I'm like, "I gotta go to the bathroom." I get up and I'm like, "Miss, can I go to the bathroom?" She's like, "Yeah, sure." I get up and I feel this scratchy feeling in my sock.

Sam Parr

woof

Shaan Puri

And I'm like, "Oh, fuck! I put the $20 in my sock this morning." That's right, I just remembered. But here I am.

Sam Parr

a drug dealer dude what do you do

Shaan Puri

Here I am, and now I'm like, "What do I do?" I'm thinking the class is going to be so mad at me if they realize this has been in my sock the whole time. The teacher's going to be so mad at me if she realizes that I accidentally did this. I didn't mean for all this to happen. So, I went to the restroom, took the $20, put it in the toilet, and flushed the toilet. Then, I went back to my seat.

Sam Parr

did you really did you really do that is that really on that end

Shaan Puri

No, that made for a better story. But I did hand it to her, and then she laughed it off. Then we went on the field trip. I thought it would be a better story, but it went the other way. That thing did happen with the sock, and it wasted half of the field trip day. That's how I feel Ilya feels right now, where he's like, "I did not mean for all this to happen. This got way bigger than I thought it was going to get." And whoops! Can I just give you this $20 and we pretend this never happened? That's what he's trying to do right now. You know, more power to him. I feel you.

Sam Parr

alright well we're gonna see what happens that's the pod