A profile-cum-investigation of Sam Altman in The New Yorker drilled deep into the OpenAI chief executive officer’s personality foibles, to put it mildly, as he steers the AI firm to an initial public offering that may value the company at more than $1 trillion. The takeaway is that even though the documents governing the IPO are unlikely to mention it, one of the biggest so-called risk factors facing the company is Altman himself.
In essence, the IPO is an acknowledgement that the ChatGPT-maker, which just raised $122 billion from investors at a valuation of $852 billion, needs what seems to be an endless amount of money to fund its race for artificial general intelligence. That aim alone would be cause for careful diligence — is AGI even possible? — without the worry that the CEO is highly unpredictable and prone to falsehoods.
Altman's hard-charging approach is a poor fit for a technology that stands to cause so much disruption. Core to the complaints of his critics is that Altman's competitive impulses have pushed safety concerns to the sidelines. Promises to generously support "superalignment" teams -- those tasked to make sure the AI acts in a way that's complimentary to humanity's aims — turned out to be hollow. A white paper published by the company on Monday, alongside The New Yorker article, seemed timed to counteract these fears, but it won't come close to settling them.
The New Yorker coaxes stinging comments on Altman's temperament from those who have worked closely with him. It includes people from his time at OpenAI as well as the startup incubator Y Combinator, where he was president until being carefully shifted out of that role.
We also get plenty of material directly from Altman himself. Presumably, OpenAI thought it safer to let him have his say rather than let others speak for him. The picture drawn is one of a conveniently forgetful CEO. He frequently told the magazine he didn’t recall what you'd think would be memorable conversations in his backstory: Confrontations with co-founders on dropping key safety pledges, for one, and an apparently fabricated statement to the US government about China's AI plans.
Concerns about Altman's trustworthiness have been around for some time. His dramatic ousting from OpenAI in November 2023 for unspecified “trust” issues and quick return failed to provide adequate closure. A full internal investigation was not published — or perhaps even written, The New Yorker reports — and the matter continues to linger over Altman and the company like unresolved family trauma.
We've seen glimpses of Altman's traits break in public, such as the testy exchange he had on a podcast in which he snapped at investor Brad Gerstner when he questioned OpenAI's spending commitments relative to its revenue. "If you want to sell your shares," Altman said, "I'll find you a buyer." I also recall, though it seems distant history now, the moment Altman threatened to pull out of European Union markets in protest of proposed regulation. He quickly backtracked on the threat, but you can tell a lot about a person by their reflexes.
To be sure, The New Yorker's reporting falls short of identifying scandal, and those who defend Altman's harsher tendencies do so knowing Silicon Valley's proud history of “brilliant jerks.” Even his detractors agree that Altman shares the relentless nature that proved so lucrative to the likes of Elon Musk and Steve Jobs. But the similarity is flawed: What Altman lacks that those men had is a militant focus on a clear vision. "Focusing is about saying no," Jobs said on stage in 1997. He quickly killed initiatives that were surplus to what he thought Apple should be doing.
Can Altman say no? What the 40-year-old described as a tendency to avoid conflict also seems to manifest as an inability to turn things down. As a result, the OpenAI heading to the public market is distracted. Altman has failed to decide what his company can do best and leave the rest of the work to others. If he’s unable to establish these priorities, he should consider whether he is the best person for the job.
The consequences are measurable:
- ChatGPT may still be the most popular chatbot but its market share is falling as Alphabet Inc.’s Google muscles in.
- Altman's big viral video app effort, Sora, was shut after it became clear it wasn't worth the required resources.
- The Stargate project to build data centers has hit snags.
- The device that Altman announced with Apple Inc. legend Sir Jony Ive a year ago is yet to be seen, while OpenAI's deal to offer ChatGPT through iOS is now being shared with its rivals. Google scooped the deal to provide the underlying model for an improved Siri assistant.
- Walmart Inc. was able to make a better performing shopping chatbot than OpenAI's own engineers. Advertisers who were a part of early trials of ads in ChatGPT were underwhelmed.
- Anthropic's vibe coding tool Claude Code is more popular than OpenAI's Codex, and Claude Cowork is more highly regarded than any of OpenAI's agentic capabilities. Anthropic’s annual run rate just over took OpenAI’s for the first time, according to Jefferies analysts.1
- OpenAI’s attempt at launching a web browser fell flat and it will now be bundled into a “superapp” project under the stewardship of OpenAI's new "CEO for AGI Deployment," the former Instacart Inc. CEO Fidji Simo. Last month she told staff they could no longer be "distracted by side quests." Good advice if her boss will take it.
Simo's hiring followed the recruitment in 2024 of Sarah Friar as chief financial officer. Friar had previously been CEO of the local social networking app Nextdoor and steered it through an IPO (albeit via a special-purpose acquisition company). Now, according to a report in The Information, Friar and Altman disagree over the timing of the IPO, with Friar reportedly saying the company isn't ready to do it this year. Friar no longer directly reports to Altman, but instead to Simo, who announced on last week she would be taking medical leave. Simo has spoken openly about her struggles with postural orthostatic tachycardia syndrome, known as POTS.
But the other internal drama has more than a hint of Altman history repeating itself. If Altman can't see eye-to-eye with his own CFO on the IPO, how can he expect prospective investors to follow him into such uncertain territory? The uncertainty Altman projects will weigh on the company’s value. Investors will feel they neither know what Altman is doing nor what he will do next.
1. Though it should be noted that Jefferies, like the rest of us, must rely on selective disclosures and press reports on the companies' condition, and the companies differ in what exactly the count as revenue. Audited financial data this is not -- the firms' respective S-1 filings ahead of IPO should offer up the first true comparison of how well each company is doing in relation to the other.
A message from Advisor Perspectives and VettaFi: Discover something new! Click here to register for our upcoming webcasts.
Bloomberg News provided this article. For more articles like this please visit
bloomberg.com.
Read more articles by Dave Lee
