Here’s the thing about asking investors for money: they want to see returns.
Technology
OpenAI was a research lab — now it’s just another tech company
OpenAI launched with a famously altruistic mission: to help humanity by developing artificial general intelligence. But along the way, it became one of the best-funded companies in Silicon Valley. Now, the tension between those two facts is coming to a head.
Weeks after releasing a new model it claims can “reason,” OpenAI is barreling toward dropping its nonprofit status, some of its most senior employees are leaving, and CEO Sam Altman — who was once briefly ousted over apparent trust concerns — is solidifying his position as one of the most powerful people in tech.
On Wednesday, OpenAI’s longtime chief technology officer, Mira Murati, announced she’s leaving “to create the time and space to do my own exploration.” The same day, chief research officer Bob McGrew and VP of post training Barret Zoph said they would depart as well. Altman called the leadership changes “a natural part of companies” in an X post following Murati’s announcement.
“I obviously won’t pretend it’s natural for this one to be so abrupt, but we are not a normal company,” Altman wrote.
But it follows a trend of departures that’s been building over the past year, following the failed attempt by the board to fire Altman. OpenAI cofounder and chief scientist Ilya Sutskever, who delivered Altman the news of his firing before publicly walking back his criticism, left OpenAI in May. Jan Leike, a key OpenAI researcher, quit just days later, saying that “safety culture and processes have taken a backseat to shiny products.” Nearly all OpenAI board members at the time of the ouster, except Quora CEO Adam D’Angelo, have resigned, and Altman secured a seat.
The company that once fired Altman for being “not consistently candid in his communication” has since been reshaped by him.
No longer just a “donation”
OpenAI started as a nonprofit lab and later grew a for-profit subsidiary, OpenAI LP. The for-profit arm can raise funds to build artificial general intelligence (AGI), but the nonprofit’s mission is to ensure AGI benefits humanity.
In a bright pink box on a webpage about OpenAI’s board structure, the company emphasizes that “it would be wise” to view any investment in OpenAI “in the spirit of a donation” and that investors could “not see any return.”
Investor profits are capped at 100x, with excess returns supporting the nonprofit to prioritize societal benefits over financial gain. And if the for-profit side strays from that mission, the nonprofit side can intervene.
We’re way past the “spirit of a donation” here
Reports claim OpenAI is now approaching a $150 billion valuation — about 37.5 times its reported revenue — with no path toward profitability in sight. It’s looking to raise funds from the likes of Thrive, Apple, and an investment firm backed by the United Arab Emirates, with a minimum investment of a quarter-million dollars.
OpenAI doesn’t have deep pockets or existing established businesses like Google or Meta, which are both building competing models (though it’s worth noting that these are public companies with their own responsibilities to Wall Street.) Fellow AI startup Anthropic, which was founded by former OpenAI researchers, is nipping at OpenAI’s heels while looking to raise new funds at a $40 billion valuation. We’re way past the “spirit of a donation” here.
OpenAI’s “for-profit managed by a non-profit” structure puts it at a moneygrubbing disadvantage. So it made perfect sense that Altman told employees earlier this month that OpenAI would restructure as a for-profit company next year. This week, Bloomberg reported that the company is considering becoming a public benefit corporation (like Anthropic) and that investors are planning to give Altman a 7 percent stake. (Altman almost immediately denied this in a staff meeting, calling it “ludicrous.”)
And crucially, in the course of these changes, OpenAI’s nonprofit parent would reportedly lose control. Only a few weeks after this news was reported, Murati and company were out.
Both Altman and Murati claim that the timing is only coincidental and that the CTO is just looking to leave while the company is on the “upswing.” Murati (through representatives) declined to speak to The Verge about the sudden move. Wojciech Zaremba, one of the last remaining OpenAI cofounders, compared the departures to “the hardships parents faced in the Middle Ages when 6 out of 8 children would die.”
Whatever the reason, this marks an almost total turnover of OpenAI leadership since last year. Besides Altman himself, the last remaining member seen on a September 2023 Wired cover is president and cofounder Greg Brockman, who backed Altman during the coup. But even he’s been on a personal leave of absence since August and isn’t expected to return until next year. The same month he took leave, another cofounder and key leader, John Schulman, left to work for Anthropic.
When reached for comment, OpenAI spokesperson Lindsay McCallum Rémy pointed The Verge to previous comments made to CNBC.
And no longer just a “research lab”
As Leike hinted at with his goodbye message to OpenAI about “shiny products,” turning the research lab into a for-profit company puts many of its long-term employees in an awkward spot. Many likely joined to focus on AI research, not to build and sell products. And while OpenAI is still a nonprofit, it’s not hard to guess how a profit-focused version would work.
Research labs work on longer timelines than companies chasing revenue. They can delay product releases when necessary, with less pressure to launch quickly and scale up. Perhaps most importantly, they can be more conservative about safety.
There’s already evidence OpenAI is focusing on fast launches over cautious ones: a source told The Washington Post in July that the company threw a launch party for GPT-4o “prior to knowing if it was safe to launch.” The Wall Street Journal reported on Friday that the safety staffers worked 20-hour days and didn’t have time to double-check their work. The initial results of tests showed GPT-4o wasn’t safe enough to deploy, but it was deployed anyway.
Meanwhile, OpenAI researchers are continuing to work on building what they consider to be the next steps toward human-level artificial intelligence. o1, OpenAI’s first “reasoning” model, is the beginning of a new series that the company hopes will power intelligent automated “agents.” The company is consistently rolling out features just ahead of competitors — this week, it launched Advanced Voice Mode for all users just days before Meta announced a similar product at Connect.
So, what is OpenAI becoming? All signs point to a conventional tech company under the control of one powerful executive — exactly the structure it was built to avoid.
“I think this will be hopefully a great transition for everyone involved and I hope OpenAI will be stronger for it, as we are for all of our transitions,” Altman said onstage at Italian Tech Week just after Murati’s departure was announced.
Technology
The best shows on Amazon Prime Video right now (October 2024)
Amazon Prime Video has its share of good and bad originals. The streaming service also offers access to plenty of legacy network shows with a base Amazon Prime subscription (or standalone Amazon Prime Video subscription). Shows removed from the service aren’t necessarily lackluster. Amazon recently canceled well-reviewed shows The Horrors of Dolores Roach and With Love, presumably because of low viewership numbers, though no specific reason was given. Amazon also axed My Lady Jane, a quirky alternate-history story that critics and audiences loved.
If you’re looking for the best shows on Amazon Prime Video right now, whether they’re ones with multiple seasons or shows that were cut short after just one or two, we have you covered. While there’s so much coming out right now for the fall, these shows are worth adding to your watch list if you haven’t seen them.
Looking for something else? We’ve also rounded up the best new shows to stream, the best shows on Netflix, the best movies on Hulu, the best movies on Amazon Prime Video, and the best movies on Disney+.
Technology
Meta is selling a $40 ‘open facial interface’ accessory for Quest 3
Meta is offering a $40 accessory for the Meta Quest 3 headset. The “open facial interface” for the Meta Quest 3 opens up the peripheral vision of the wearer.
Meta Quest 3 “open facial interface” is now available for just $40
The Meta Connect 2024 conference was a feature-packed event. Meta’s CEO not only announced the Orion Augmented Reality (AR) holographic display but also the aggressively priced Quest 3S.
One of the products that made its way to the launchpad was the “open facial interface” for the Quest 3 Virtual Reality (VR) headset. According to Android Central, this $40 accessory is trying to fill the gap left by the Meta Quest Pro, which is set to be discontinued.
Meta has announced it has begun selling the new accessory. It is up for pre-order on Meta’s e-store. The earliest estimated shipping date for early adopters is mid-October.
The new accessory is lighter and adds another way to wear the VR headset
The social media giant assures the open facial interface offers an open-periphery experience similar to that of the Meta Quest Pro. Interestingly, when the Quest Pro is no longer officially available, the Quest 3 (with the open facial interface) will be the only official way to use a Meta VR headset with open sides.
The open facial interface is only compatible with the Quest 3, not the new Quest 3S. The Quest 3S has a “breathable facial interface”. But it is certainly no match for the open facial interface. Some reports suggest this accessory could create an illusion of a wider field of view.
Finally it’s available for pre-order.
The Pro feeling is coming to Meta Quest 3!”Meta Quest 3 open facial interface”
Now just wait for pre order shipment… #VR #Meta #Quest #Open #Facial #Interface #Pro pic.twitter.com/jlHhXt61b8
— R347ITY (@R347ITY) September 25, 2024
The open facial interface would surely help with the lens fogging issue. By creating a gap between the user’s head and the headset, this accessory also opens access to the wearer’s surroundings.
With this accessory, Meta is now offering a new way to use the Quest 3 VR headset. The default interface that comes in the box is meant for everyday use. The silicone facial interface, sold separately for $40, is intended to be worn during workout sessions and games involving a lot of movement.
Meta claims the open facial interface is “best for spatial experiences”. Interestingly, weighing just 60 grams, this accessory is lighter than the other two. This means using this accessory could subtly lighten the load of the VR headset.
Servers computers
67 9 2 Overview of UCS C Series Rack Servers
Technology
OpenAI reportedly plans to increase ChatGPT’s price to $44 within five years
OpenAI is reportedly telling investors that it plans on charging $22 a month to use ChatGPT by the end of the year. The company also plans to aggressively increase the monthly price over the next five years up to $44.
The documents obtained by shows that OpenAI took in $300 million in revenue this August, and expects to make $3.7 billion in sales by the end of the year. Various expenses such as salaries, rent and operational costs will cause the company to lose $5 billion this year.
OpenAI is reportedly circulating the documents the NYT reported on as part of a drive to find new investors to prevent or lessen its financial shortfall. Fortunately, OpenAI is raising money on a $150 billion valuation, and a new round of investments could bring in as much as $7 billion.
OpenAI is also reportedly in the midst of switching from . The business model allows for the removal of any caps on investor returns so they’ll have more room to negotiate for new investors at possibly higher rates.
Servers computers
Dell PowerEdge 1950 Rack Server – Overview, Specifications, Benefits & Uses
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Technology
AI dominated both YC Demo Day and startup news
Welcome to Startups Weekly — your weekly recap of everything you can’t miss from the world of startups. Want it in your inbox every Friday? Sign up here.
This week was a busy one for the startup and VC world, with its fair share of funding news and, of course, the latest edition of YC’s Demo Day.
Most interesting startup stories from the week
Yes, AI, AI, AI. But it’s more eventful than it sounds.
Departures: Several key people are leaving OpenAI — CTO Mira Murati, as well as the company’s chief research officer and a research VP. There’s more context than we can sum up here, so go have a read if you are so inclined.
Ive mind: It is now confirmed that former Apple designer Jony Ive is working on an AI device startup with OpenAI and its CEO Sam Altman. The unnamed venture could be seeking to raise up to $1 billion by the end of the year.
AltGPT: Letta, an AI startup founded by the researchers behind MemGPT and positioning itself as “the open alternative to OpenAI,” has come out of stealth to much anticipation.
Pipelines: Data startup Airbyte launched Airbyte 1.0 with a focus on AI use cases. It also made its self-managed enterprise service generally available.
Most interesting fundraises this week
COVID-19 almost killed some companies and boosted others. Now companies from both groups are finding their footing, and other trends are getting confirmed.
Working out: German connected fitness startup EGYM closed a $200 million Series G round of funding that confirms investor interest in the broader trend of preventative healthcare.
Digital transformation: Whatfix, a San Jose-based company whose platform demonstrates how to use third-party software, raised a $125 million Series E round led by Warburg Pincus.
AI power: Open source developer platform Supabase raised an $80 million Series C round. The company now positions itself as Postgres-centric and has been enjoying AI tailwinds; 10% of active databases on the service power AI use cases.
Beaming: Marvel Fusion raised €62.8 million in a Series B round to work on making commercial fusion power a reality thanks to lasers.
In the spotlight: British startup Raycast raised $30 million to bring its Mac productivity app to Windows and iOS, with a focus on “prosumer” users.
Most interesting VC and fund news this week
Exit time: Peak XV Partners, the largest India and Southeast Asia-focused VC fund, realized about $1.2 billion in exits since its split from Sequoia last year, TechCrunch learned from sources.
Skyrocketing: European defense tech will attract $1 billion in VC funding this year, according to a new Dealroom report. This significant increase compared to previous years also goes along rising interest for dual-use technologies.
Sailing: Spanish VC firm All Iron Ventures rebranded as Acurio Ventures and closed a third fund of $166 million that will exclusively make “follow-on” investments.
Last but not least
Taking place on September 25 and 26, Y Combinator’s online Demo Day for its Summer 2024 batch was once again dominated by AI use cases, some particularly exciting. The format itself is changing: Going forward, there will be four Demo Days a year, and YC CEO Garry Tan said that the next one on December 4 will include an in-person element.
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