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OpenAI has hit back at Elon Musk, releasing emails to show that he supported its plan to create a for-profit entity and raise billions of dollars — decisions at the heart of the Tesla boss’s lawsuit against the artificial intelligence start-up.
Musk, who was part of OpenAI’s founding team, claimed in the suit he filed last week that it had breached an agreement to make breakthroughs in AI “freely available to the public” by forming a multibillion-dollar alliance with Microsoft, which has committed $13bn to the company.
“OpenAI, Inc has been transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft,” Musk’s lawsuit alleged.
In a blog post published late on Tuesday, founding members of OpenAI including Sam Altman, Greg Brockman and Ilya Sutskever contested that allegation, claiming instead that Musk had spearheaded early efforts to raise more money from investors.
“When starting OpenAI in late 2015, Greg and Sam had initially planned to raise $100mn,” they wrote, but “Elon said in an email: ‘We need to go with a much bigger number than $100mn to avoid sounding hopeless . . . I think we should say that we are starting with a $1bn funding commitment.’”
OpenAI’s original non-profit structure hampered its ability to raise funds from traditional investors. Given the expense of building AI tools, that presented a barrier to its stated mission to develop increasingly sophisticated AI “that benefits all of humanity”.
“In late 2017, we and Elon decided the next step for the mission was to create a for-profit entity. Elon wanted majority equity, initial board control, and to be CEO. In the middle of these discussions, he withheld funding,” according to the blog post.
“We couldn’t agree to terms on a for-profit with Elon because we felt it was against the mission for any individual to have absolute control over OpenAI. He then suggested instead merging OpenAI into Tesla. In early February 2018, Elon forwarded us an email suggesting that OpenAI should ‘attach to Tesla as its cash cow’,” Altman and his colleagues wrote on Tuesday.
The exchange highlights tensions over the direction of Silicon Valley’s most feted start-up, which kicked off an AI boom with the launch of ChatGPT in November 2022 and has since set the pace among competitors including Anthropic, Inflection and Google.
The start-up has become a commercial juggernaut with revenues of more than $2bn on an annualised basis and has drawn billions of dollars of investment from Microsoft and a host of venture capital firms since launching a for-profit entity in 2019, rocketing to a private market valuation of about $80bn, according to a person familiar with the matter.
But concerns over governance and safeguards at the company remain, after the dramatic ousting and reinstatement of Altman as chief executive by members of the board — including Sutskever — last November.
An internal investigation into the boardroom tumult is expected to be completed in the next month, while the US Securities and Exchange Commission has separately probed some actions by the company and its executives during last year.
Musk — who left OpenAI’s board in 2018 after clashing with Altman — is raising money for his own AI project, named xAI.
“We’re sad that it’s come to this with someone whom we’ve deeply admired — someone who inspired us to aim higher, then told us we would fail, started a competitor, and then sued us when we started making meaningful progress towards OpenAI’s mission without him,” wrote the remaining leadership team.
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