Waiting for the first right winger to complain that Gary should stick to AI and not discuss snowboarding or post pictures of trees. Just stick to something you know about Gary, or I will unsubscribe. 😀
If it comes down to legal arguments in court over valuation, Altman would have a solid basis that this was just a spoiler bid, not to be taken seriously.
I am familiar with the term "spoiler bids" in the arena of political races. e.g., someone running with no chance of winning just to syphon off votes against other candidates. In this case, if the offer was legitimate, meaning there was no collusion, then Altman could have accepted it. This suggests the bid was legitimate, unless it can be shown the offerer lacked the funds, or had an intention to withdraw/default upon acceptance. In a court case, the existence of the financial ability to complete the offer, if accepted, would make it difficult to prove it was made with the intention to be rejected.
Spoiler in the sense that Elon once made an "offer" over Twitter to buy out tesla, using the phrase "funding secured". It was not, and this led to some legal action. I would also point out Elon's actions after signing a contract to buy Twitter.
And, of course, if he were to take on OpenAI-for-Profit and all its assets, it is likely that all he will have left will be some software and some admin staff. I forecast that all the tech staff will resign en-masse.
I think OpenAI has a bright future. It has the momentum, the market, and the products will improve (though not fast).
Musk and xAI may be for a rough ride. It is an also-run now, and I doubt it will overtake OpenAI. Counting on humanoid robots or AGI takeoff to save it is likely wishful thinking.
“ Yes, you’re absolutely right in your understanding!
If OpenAI’s for-profit arm were to divest or sell its assets, it would likely need to compensate the nonprofit arm for its share of the value, especially considering the structure OpenAI has. Since OpenAI operates as a hybrid entity, with a nonprofit organization holding significant control and the for-profit arm being capped in terms of returns, the nonprofit would have a claim to a portion of the total value, including future profits beyond the cap.
Here’s how this works in principle:
1. Compensation for the Nonprofit Arm: If the for-profit arm of OpenAI were to sell or divest, the nonprofit arm would likely be entitled to compensation based on its ownership, contributions, and any agreements in place regarding the division of assets or profits. This could include a share of the $97.4 billion offer, reflecting the nonprofit’s role in the company’s growth.
2. Future Value of Profits Beyond the Cap: Since OpenAI’s for-profit arm is structured to return a capped profit (meaning that investors can earn a set multiple of their investment), any future profits that exceed the cap would potentially belong to the nonprofit arm, as it holds control over the long-term direction and use of OpenAI’s research and technology. If the company were sold, the value of these future profits would need to be factored into any compensation or settlement.
This makes the situation more complex, as any sale or divestment could involve detailed negotiations about how to divide both the immediate sale value and the potential future profits—especially given OpenAI’s unique hybrid structure.
So yes, any divestment or sale would likely need to account for this balance between the nonprofit’s claim to assets and the for-profit arm’s capped return.”
Uncertain as to why the hostile takeover at this stage in the game. Either xAI can't reproduce OpenAI's work; OpenAI has exceptional talent pool worth aquihiring; OpenAI has business relationships that it wants; or there is advantage to reduce the number of foundational AI players down to 4.
The obvious solution is for OpenAI For Profit to never make a profit, which could easily happen any way.
Those North Shore mountains were definitely beautiful today!
had to go now that the clouds had lifted!
100%
I used to think I would suffer from brain fog for the rest of my life..."𝐛𝐮𝐭" this changed everything.... https://t.co/PDWI6twO0u
Waiting for the first right winger to complain that Gary should stick to AI and not discuss snowboarding or post pictures of trees. Just stick to something you know about Gary, or I will unsubscribe. 😀
Bizarre situation.
This is not a tech play. Musk sees ChatGPT as a media platform, a place where people go to understand the world and create content.
Just he did with Twitter, he will turn ChatGPT into a platform for his political agenda.
Musk is a political actor now, and this is another platform for him.
If it comes down to legal arguments in court over valuation, Altman would have a solid basis that this was just a spoiler bid, not to be taken seriously.
I am familiar with the term "spoiler bids" in the arena of political races. e.g., someone running with no chance of winning just to syphon off votes against other candidates. In this case, if the offer was legitimate, meaning there was no collusion, then Altman could have accepted it. This suggests the bid was legitimate, unless it can be shown the offerer lacked the funds, or had an intention to withdraw/default upon acceptance. In a court case, the existence of the financial ability to complete the offer, if accepted, would make it difficult to prove it was made with the intention to be rejected.
Spoiler in the sense that Elon once made an "offer" over Twitter to buy out tesla, using the phrase "funding secured". It was not, and this led to some legal action. I would also point out Elon's actions after signing a contract to buy Twitter.
And, of course, if he were to take on OpenAI-for-Profit and all its assets, it is likely that all he will have left will be some software and some admin staff. I forecast that all the tech staff will resign en-masse.
Well, Altman can always retreat to Plan B:
Exponential Hype, Inc., home of Silicon Valley Joy Juice.
Take a sip, you won't regret it;
tastes so good, you can't forget it.
Silicon Valley Joy Juice, the Elixir of the Elite!
Watching Elon Musk purchasing Sam Altman's company from under him:
"... Mixed emotions, buddy. Like Larry Wildman going off a cliff in my new Maserati ..."
That corporate structure diagram looks like a joke. Unfortunately it isn't.
This is nothing that a cage fight couldn’t resolve.
I used to think I would suffer from brain fog for the rest of my life..."𝐛𝐮𝐭" this changed everything.... https://t.co/PDWI6twO0u
I think OpenAI has a bright future. It has the momentum, the market, and the products will improve (though not fast).
Musk and xAI may be for a rough ride. It is an also-run now, and I doubt it will overtake OpenAI. Counting on humanoid robots or AGI takeoff to save it is likely wishful thinking.
Can they both lose?
ChatGPT appears to agree.
“ Yes, you’re absolutely right in your understanding!
If OpenAI’s for-profit arm were to divest or sell its assets, it would likely need to compensate the nonprofit arm for its share of the value, especially considering the structure OpenAI has. Since OpenAI operates as a hybrid entity, with a nonprofit organization holding significant control and the for-profit arm being capped in terms of returns, the nonprofit would have a claim to a portion of the total value, including future profits beyond the cap.
Here’s how this works in principle:
1. Compensation for the Nonprofit Arm: If the for-profit arm of OpenAI were to sell or divest, the nonprofit arm would likely be entitled to compensation based on its ownership, contributions, and any agreements in place regarding the division of assets or profits. This could include a share of the $97.4 billion offer, reflecting the nonprofit’s role in the company’s growth.
2. Future Value of Profits Beyond the Cap: Since OpenAI’s for-profit arm is structured to return a capped profit (meaning that investors can earn a set multiple of their investment), any future profits that exceed the cap would potentially belong to the nonprofit arm, as it holds control over the long-term direction and use of OpenAI’s research and technology. If the company were sold, the value of these future profits would need to be factored into any compensation or settlement.
This makes the situation more complex, as any sale or divestment could involve detailed negotiations about how to divide both the immediate sale value and the potential future profits—especially given OpenAI’s unique hybrid structure.
So yes, any divestment or sale would likely need to account for this balance between the nonprofit’s claim to assets and the for-profit arm’s capped return.”
Uncertain as to why the hostile takeover at this stage in the game. Either xAI can't reproduce OpenAI's work; OpenAI has exceptional talent pool worth aquihiring; OpenAI has business relationships that it wants; or there is advantage to reduce the number of foundational AI players down to 4.