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EDMONTON, CANADA - APRIL 20: An image of a woman holding a cell phone in front of a OpenAI logo displayed on a computer screen, on April 20, 2024, in Edmonton, Canada.
OpenAI’s nonprofit days are behind it
Big changes are coming to OpenAI.
The company behind ChatGPT started as a nonprofit research lab, but its success has led to an identity crisis of late. Does it want to make money or serve a purpose beyond its bottom line?
Until now, the answer was seemingly the latter. But following a series of top executive exits — including chief technology officer Mira Murati — OpenAI is preparing to become a completely for-profit company. That change also coincides with the startup’s plans to raise more money to reach a target valuation of $150 billion.
Sam Altman, the co-founder and CEO who was booted from OpenAI by its nonprofit board of directors in 2023, regained control of the company after OpenAI employees revolted and lead investor Microsoft expressed discontent. The nonprofit board largely resigned afterward and was replaced with one friendlier to Altman. It now looks like Atlman’s reign will be as firm as ever. The executive denied reports that he’s set to receive a 7% stake in OpenAI, worth upwards of $10 billion, but the switch to for-profit might mean less beating around the bush about its money-making ambitions.
OpenAI has been running a for-profit arm since 2019 so it could get billions in investment from venture capitalists and tech investors, who reportedly prefer if OpenAI is a public-benefit corporation, a type of for-profit with a social mission, rather than a nonprofit. Now, it’s seemingly taking that decision to its natural conclusion, putting its focus on creating a sustainable business ahead of its lofty societal promises about protecting humanity from AI.In this photo illustration, the OpenAI logo is displayed on a smartphone screen with the text artificial intelligence in the background.
OpenAI’s getting richer
OpenAI is in talks for a new funding round that could value the company over $100 billion. That would cement it as the fourth-most-valuable privately held company in the world, only behind ByteDance ($220 billion), Ant Group ($150 billion), and SpaceX ($125 billion).
Thrive Capital is leading the venture round, but Microsoft is expected to add to its existing $13 billion stake in the company. Apple and Nvidia, are also discussing investing in the ChatGPT maker. Nvidia supplies chips that OpenAI uses to train and run its models while Apple is integrating ChatGPT in its forthcoming Apple Intelligence system that'll feature on new iPhones.
OpenAI was last valued at around $80 billion in 2023 following a funding round that allowed employees to sell their existing shares. It’s unclear whether the company is currently considering an initial public offering, but if it needs tons of capital for the very costly process of developing increasingly powerful AI models, that might be a necessary step in the not-so-distant future.
World trade at risk without globalization, warns WTO chief Ngozi Okonjo-Iweala
On GZERO World, Ian Bremmer sits down with WTO Director-General Ngozi Okonjo-Iweala to talk about world trade, the complicated business of moving goods and services across borders around the world.
Global trade hit a staggering $32 trillion in 2022 and the World Trade Organization oversees 98% of it. It’s an international institution that doesn’t normally make headlines, but has a massive role in almost every aspect of your daily life—from the food you eat, to the clothes you wear, to the cars you drive, to the phone you’re probably using to watch this video.
The WTO is the referee of global trade, a place for countries to negotiate agreements and resolve disputes. But it’s also received criticism for being too slow to adapt to the modern economy and for favoring wealthy nations over countries in the Global South.
Okonjo-Iweala has been pushing members to recommit to the principles of globalization and invest in developing economies.
“It's not right that 10 countries export 80% of the vaccines in the world,” Okonjo-Iweala says, “It's too concentrated.”
She argues that by decentralizing and diversifying global supply chains, we can make the global economy more resilient, reduce monopolies, and bring countries left on the margins of world trade into the mainstream.
Watch GZERO World with Ian Bremmer every week at gzeromedia.com/gzeroworld and on US public television. Check local listings.
- Episode 4: Broken (supply) chains ›
- US-China communications brighten over trade ›
- Climate change trade wars ›
- Hard Numbers: German far right comes up short, Ukraine dreams of drones, a space rock arrives on earth, world trade slows ›
- Women in power — the World Trade Organization's Ngozi Okonjo-Iweala ›
- What Africa has to say about climate change ›
- The Graphic Truth: Has climate change hurt or helped farmers? ›
- Crisis at the WTO: Fixing a broken dispute system - GZERO Media ›
- Navigating global trade during uncertain times - GZERO Media ›
- AI can reduce trade costs, says WTO's Ngozi Okonojo-Iweala - GZERO Media ›
Will tech giants be taxed for worldwide profits with a global tax rate?
Get insights on the latest news about emerging trends in cyberspace from Marietje Schaake, International Policy Director at Stanford University's Cyber Policy Center and former European Parliamentarian:
Today, we talk about the "T word", as I often refer to: taxation. But that taboo is finally broken in the United States.
How would a global minimum corporate tax rate, like the one Janet Yellen has called for, affect Big Tech?
Now, ideally, it would ensure a level playing field for all companies, and European leaders embrace the US change of course, but they did add that there should be ways to tax tech giants for their global profits. It's a demand that is widely shared in Europe. So the hope is that that can be arranged between all OECD members.
What has been Silicon Valley's reaction so far?
I haven't heard so much from Silicon Valley, so perhaps they're lobbying US leaders behind the scenes, more so than publicly. But it does look like the US government needs to compromise on that digital tax question to get their global minimum corporate tax rate done at all.
- How can the Biden administration rein in Big Tech? - GZERO Media ›
- The Graphic Truth: Who dominates social media? - GZERO Media ›
- The Big Tech breakup: Could it happen? - GZERO Media ›
- Kara Swisher on Big Tech's big problem - GZERO Media ›
- Multinational corporations aren't about to give up on global business - GZERO Media ›
Biden infrastructure plan would boost jobs; Georgia voter law tensions
Jon Lieber, Managing Director of the United States for the Eurasia Group, shares his insights on US politics:
What specifics do you expect to be in Biden's "build back better" infrastructure plan?
Well, this is really a two-part plan. The first part Biden's rolling out this week, and it's focused mainly on infrastructure. Bridges, roads, tunnels, transit, the whole infrastructure smorgasbord, including on broadband deployment, as well as investing in things like rural hospitals, schools and upgrading buildings to be more energy efficient. Biden's proposed between $2 and $2.5 trillion depending on how you do the math, paid for by tax increases primarily falling on the corporate sector that actually spread out over 15 years, as opposed to the bill's spending, which spreads out over 10. That means the bill will be mildly stimulative to the economy on top of creating potentially new jobs through the direct spending that's going to happen.
The tax increases are focused largely on corporate America, higher corporate tax rate, changes in the way US taxes its multinational corporations, and other changes that come on the individual side, which will be primarily used to fund the second half of the plan, which is going to be focused on more of a human services element. These are things like education, healthcare, subsidies for daycare, universal pre-K, community college, and other things that the Biden administration contends have to be invested in to keep the American economy going. Now, these tax increases are going to be really controversial with Republicans, which means you're probably not going to see a lot of Republicans vote for this. But Democrats are pretty aligned around doing something big and meaningful in advance of the 2022 midterms. So both of these bills probably pass into law before the end of the year.
What's going on with the Georgia voter law?
Well, in the wake of a 2020 election, where President Trump claimed there was widespread fraud, Republican politicians are now moving across the country to roll back some of the expansions that were done during the coronavirus pandemic to make it easier to vote. In Georgia, this has meant curtailing the ability to vote on Sundays, it's meant requiring a photo ID, and it's meant limiting to some extent, the ability to apply for an absentee ballot. Most of these changes are rolling the voting rules back by a couple of years. This is not the apocalyptic changes that the Democrats have been claiming, but the Democrats are really motivated to stop all of this from happening because they want to open up voting and make it as easy as possible for their constituents to get out. They typically do better at higher turnout elections. Republicans typically do better in lower turnout elections.
So for Democrats this is really, for both parties, this is really considered an existential threat, and the voting rules are going to be a really important battleground over the next 12 to 18 months. At the federal level, the Democrats are pushing a bill, H.R. 1, that would fundamentally alter the way elections are conducted in this country, including by changing money in politics and eliminating partisan gerrymandering, by requiring each state to use a nonpartisan commission to draw the districts for the House of Representatives. If it passes, and I don't think it will because it would require today 60 votes in the Senate, but if it were to pass, it would be a big structural shift towards the Democrats in US elections.
Quick Take: Hypocrisy, truth, & authenticity in today's environment
Ian Bremmer's Quick Take:
Hi everybody, Ian Bremmer here. And happy Tuesday to you. I've got a Quick Take starting a little bit later because heck, we had a day off yesterday. It was President's Day. I hope you all enjoyed it. And even in Texas, I know it's tough down there right now, and not much fun. Here in New York, it's actually starting to thaw, which I appreciate, Moose does too.
Want to talk a little bit about hypocrisy, about truth, about authenticity, and what it means in today's environment. There is so much of the news that is driven by people not being trustworthy, by fake news.
And what I see the last few days, of course, with the failed impeachment, not a surprise, but so many people at the beginning thought that Senate minority leader, now, McConnell was actually going to vote against Trump, and he did not. And instead, he said that this is not the domain for the Senate. It should go to the justices, or should go to a criminal case, or a civil case, which is, of course, false. It's all about just maintaining power for the Republican party.
I see the CDC in the United States now going back on guidance around opening schools that they had offered with the best of their healthcare expertise that they have because teachers' unions in the United States have so much influence over the Democratic party. And so, as a consequence, it's going to be very difficult to go ahead with those school openings with a lot of damage to the students continuing as a consequence. I can go on and on and on.
But what I think is important to understand is that your business model is your values. It is what you actually spend all of your time trying to accomplish and to maximize. Your business model is your values. And so frequently we look at what people say, and we look at their communication strategy, and we forget what their business model is. And so, understanding the fundamental drivers of an organization, or people that are leading that organization so much more important. When you join an organization, understanding that is absolutely critical.
And when I think about culture, you can change culture. If you change the... because culture is about the people. Who are the people in an organization? Do you like them? What are they like? How ambitious are they? How oriented are they towards other people? Are they introspective? Are they experts? Are they super intellectuals? Are they deeply aggressive? You can change culture. And, indeed, you can change priorities because leadership and management is all about which priorities you put lots of resource in, you put the most effort in. If you change out that leadership, you'll change the priorities, you'll change the orientation. But you can't change the values without changing the business model. And business models tend to be very sticky.
When I think about climate change, and the science on climate change is not perfect, but it has been overwhelmingly in one direction for decades now. And virtually all of the effort to push back against that science was about business models, which were fundamentally going to be undermined by moving towards the science. And that's not just true in terms of coal and fossil fuel companies, and infrastructure that relies on them, and also bureaucracies that are paid by those people, and other organizations and studies that are aligned to them. But we have seen this go on now for decades. And the arguments will change as is required by the business model.
So, for decades, we have people saying that climate is not changing, that the science is unproven. And that worked for a long time, and then it didn't. And so, then the fallback position was it's changing, but people aren't doing it. It's actually just natural cycles. And so, we shouldn't respond to it. And that worked for about a decade more or less in slowing things down. And then it's, well okay, no it is changing, and it is manmade. And the science has indeed proven we can't stop that anymore. But it certainly is way too expensive to respond to it, to resolve it.
And then, we see that in a surprisingly short amount of time, the cost of solar and of wind and other renewables can be brought down significantly, exponentially. And then, it's well no, but you can't rely on those energy sources. And that too, I mean, just this week with what we're seeing in Texas, and I'm getting all of this inbound today of people telling me about all of the wind that has been taken offline because of the freezing, which is true, but much more gas has been taken offline with the freezing both absolute amounts as well as percentage of total. But that, of course, is not a problem to vested interest. The business model matters.
Now, if you change the business model, if you start investing in a broader portfolio of different types of energy precisely because you understand that these things are changing over time and you take a longer-term perspective that will change your values. But many organizations didn't. And for those that didn't, their values are increasingly directly in opposition to science.
And it's not just that, I think about social media today. I think about Facebook today. I think about how much of what Facebook's comm strategy has been about how good it will be for all of us as individuals to be able to connect and put the best part of ourselves out publicly. And yet, of course, it causes massive amounts of emotional damage. And we know that the executives of these companies do not allow their own kids to have access to the platforms because they understand the addictiveness programmed into the algorithms. But the business model determines the values.
We know that Twitter would be so much less destructive as a place, if it did not have fake bots, people that aren't people that are doing nothing but promoting extreme views that are not differentiated by a lot of folks on Twitter as being real or fake. But those things are aligned with the business model because you make a lot more advertising revenue when you have a lot more people that are spending a lot more time, even if they're not real people, on the platform. Suddenly remove 50% of your users because they're not real, and suddenly your business model is much more problematic. So, it is about the business model.
Whatever your company sells, those are its core values. And if you want to unpack their actions and what they actually do, where they spend their money, what they lobby for, those are your values. If you're working for that organization, those become your values because that's what you are spending your time doing. And it particularly matters if you want to understand the United States, because in the US, the core, the dominant actors in determining the political agenda and strategy are the private sector actors, who capture the regulatory process. They're dominant in China. It's not, in China, it's the state. And so, you'd want to understand what's the business model fundamentally for the state, which is political stability, and not economic maximization. And when those two things come into contact, come into conflict the Chinese government overwhelmingly chooses political stability in ways that a lot of Americans, in the foreign policy establishment, frequently get wrong, because they assume that the Chinese also want to grow, grow, grow. Well, yes, except not if it's a threat to the communist party or the state.
And then, in Europe, you have the bureaucracy, the technocrats in Brussels who have most of the power. And individual states have less sovereignty, and private sector actors have less sovereignty. So, you want to understand the business model of a whole bunch of people that spend their entire careers in Brussels, reasonably well-paid, and aligned to the perpetuation of those institutions.
So, if you want to change your values, you need to change what you actually do. If you want to change a company's values, you need to change their business model. And that's much stickier and it's much harder to do. And in an environment where we are saying that increasingly capitalism does not work as presently constructed for a lot of average citizens, you can see why the United States is actually in a more difficult position to respond, because it's not the state that's going to have the influence. It's not the bureaucracy that's going to have the influence. It's the private sector actors themselves.
And so, one has to look into those private sector actors and see which of them have business models that are themselves most aligned with making the changes. Climate is now happening to a greater degree in the United States because with coronavirus you had this sudden mass acceleration of power towards a whole bunch of companies whose business models aren't aligned with undermining science on climate. And those that are, are vastly weaker than they used to be. But, on most other issues, that is a big challenge in the United States. Something we are going to spend a lot more time on going forward.
So, I hope that was worthwhile and interesting. Look forward to keeping in touch over the course of the week and going forward. Be good, stay safe, and avoid people.
The new wave of innovation is cause for business optimism about 2021
Kevin Sneader, Global Managing Partner at McKinsey & Company, provides perspective on what corporate business leaders are thinking during the global coronavirus crisis:
Should businesses be pessimistic or optimistic about 2021?
It's easy to be gloomy about the year ahead when faced with the realities of a cold, bleak winter in much of the world. Add to that lockdowns across Europe, surging case numbers and hospitalizations, and dreadful events in the Capitol in the US to name a few reasons for pessimism. But I think there is a case for optimism when it comes to this year. After all, it's true to say that it's always darkest before the dawn, and my conversations with business leaders suggest there are reasons to be positive by 2021.
Consider the following, yes, the vaccines are on their way, but so too is the impact of a wave of innovation. Twice the number of new business applications in the US and significant increases in new business starts in Germany, France, the UK and Japan. It's not just the digital economy that is reshaping lives, but science more generally with the impending bio revolution. And new ways of working are being accepted. Manufacturing is reviving and many sectors are seeing signs of confidence returning.
The great Anglo-Irish explorer Ernest Shackleton when faced with a life-or-death challenge of survival in the Antarctic commented, "optimism is true moral courage." It's time for some of that courage as we tackle 2021 with optimism.
Learnings from working post-COVID: economy, work-life, leadership
Kevin Sneader, Global Managing Partner at McKinsey, shares his perspective on corporate business leadership on Business In 60 Seconds:
What do we know now that we did not know four months ago when the coronavirus struck with vengeance?
I think there's a lot. First, we've learned about our economy. We know that we've now taken the elevator down and we're taking the stairs back up. We're seeing a return, as I observe what's happening across the world, but from a very low base. And the letter of choice is not an L, a V or a U, but I think it's a big question mark.
Secondly, we've learned about what we like in the workplace and what we do not. Indeed, much that has proven attractive about remote working has stuck. Time with family. The ability to source expertise wherever it may be located. But there's much that's not. After all, as many have said to me, there's a fine line between sleeping at the office and working from home.
Third, we've learned about leadership. As one CEO suggested, all the traditional stuff does matter. Being a good listener. Being aware of the details, able to see the big picture. But perhaps the most valuable capability is one that's not often associated with CEOs, it's being able to show some love, to show some love. We've learned that first and foremost, this is a humanitarian crisis and one where empathy and understanding have really proven to be the leadership qualities that matter.