What may really be behind Openai’s failed bid

Openai’s board of directors has officially rejected Elon Musk’s nearly $100 million offer to the makers of ChatGpt, the world’s most well-known artificial intelligence (AI) tool.

But unsolicited bids may not be a failure – at least as far as musk is concerned, experts say.

This is because the offer could complicate the CEO’s plans to turn Sam Altman’s plans from a nonprofit to a for-profit company.

Musk is “basically trying to style the trajectory of open growth,” Professor Johnny Penn, an associate professor at Cambridge University, said in an interview with the BBC.

Last week, a consortium of investors, including Musk and Hollywood superagent Ali Emmanuel, presented an offer of $97.4 billion (£78.4 billion) for all Openai assets.

It was a huge sum, but companies under $157 billion were valued in funding rounds just four months ago, far below the $300 million that some people thought were worth it now I did.

Complicating all this is Openai’s extraordinary structure, with a partnership between nonprofit organizations and for-profit weapons.

Altman understands that he wants to change it and strips the nonprofit committee.

That includes the costs Musk is apparently trying to inflate.

“What Musk is trying to do here is to increase the perceived value of Openrai’s nonprofits, so Open will have more money to get out of the obligations it has to its own nonprofit. You have to pay,” Dr. Penn said.

The value of non-profit assets is not clear. Musk was priced on his bids, according to Lutz Finger, a senior lecturer at Cornell University who is also the founder and CEO of AI Startup R2Decide.

“By putting a price tag on the non-profit portion, he makes the split even more expensive for Altman,” Finger told the BBC. “It’s very easy.”

Musk justified his actions by saying he wanted to return Openai, which he co-founded, to its non-profit roots and to its original mission to develop AI for the benefit of humanity.

However, others suggest that he has a somewhat less noble motive linked to his own AI companies Xai and Chatbot Grok.

“Musk missed the AI ​​train to some extent. He was behind and made some attempts to catch up,” Finger said.

Now, Finger says Musk is trying to get his most frightening competitor to his knees.

Last week, the already tense relationship seemed to have worsened. Altman untold Musk’s offer in X, rebutting by Musk calling his former partner “a con man.”

Altman then returned to an interview with Bloomberg, stating that Musk was not a “happy person” and that his decision was made from a “standing position.”

Tit-for-Tat has also been deployed in court. There, U.S. District Judge Yvonne Gonzalez Rogers is considering a request for an injunction to block the planned conversion of the opening.

He claims he will be irreparably hurt without her intervention.

“It’s plausible that what Musk is saying is true. We’ll sit in the stands,” Gonzalez Rogers said at a hearing at Mask v Altman earlier this month in Oakland, California. .

Musk’s recent bid contradicts his previous claim that Openai’s assets cannot be transferred for “private interests.” According to Openai’s lawyers.

“(o) the court’s ut, these constraints clearly do not apply. As long as Musk and his allies are buyers,” their response states.

Some observers say that making a deal doesn’t seem to be his goal.

“I think he’s just trying to create noise, news and surprises,” says Carl Freund, founder and principal analyst of Cambrian Eye.

But in addition to causing problems for his old rivals, the strategy could endure damage to Musk’s own reputation.

“He’s great. He creates incredible companies that do incredible things. But his personal agenda has put people into questioning his motivations. ” Freund said.