The drama at OpenAI … what really happened that triggered Sam Altman’s firing … we’ve hit Act II of the AI Boom … a live event with Luke Lango about where to find the biggest AI winners
Last week’s drama surrounding OpenAI and the firing/rehiring of its CEO Sam Altman was fascinating to watch. But behind the headlines was something much more impactful on society – and investors – than just a struggle for corporate power.
The press’s primary coverage focused on the surface details. A deeper dive into why it all happened was largely glossed over. Most reports pointed toward a disagreement between Altman and the OpenAI board about the speed at which to bring new AI improvements to the market.
But our own AI expert Luke Lango believes that the real story is far bigger than corporate politics. The reality is we just hit a watershed “before and after” line in the sand:
The recent developments at OpenAI mark a critical inflection point into what I’m calling Act II of the AI Boom: a rapid and immensely successful “profit push” that will turn AI from a research concept into a series of world-changing products and services.
Let’s get everyone up to speed on the headline story, the real story, and then a special AI-centered event with Luke tomorrow night – the timing of which is fascinating given this OpenAI drama.
***The drama began roughly one week ago when the board of OpenAI suddenly fired its CEO Sam Altman
Let’s begin with what you’ve likely read. It’s the main story that’s being told.
The OpenAI board abruptly fired its CEO and co-founder, Sam Altman, [two Fridays ago] setting off a chaotic weekend in which the board tried and failed to undo the decision. Within 48 hours, Microsoft had announced that it had tapped Altman to lead a new in-house AI group.
The anger within OpenAI spilled over [last] Monday, more than 500 of its employees threatened to quit unless they get Altman back and the current board resigns.
On Monday, Microsoft CEO Satya Nadella…acknowledged Altman may ultimately return to lead OpenAI if the hundreds of employees who threatened to resign are successful in their attempt to lure him back.
Then, last Wednesday, news broke that OpenAI had reversed course, bringing Altman back as CEO. The board members responsible for his ousting were let go.
As I write Monday morning, the dust is settling as OpenAI goes back to business.
So, what exactly caused the firing in the first place?
At the beginning of last week, CNN pointed toward differences in philosophy between the board and Altman:
OpenAI’s board has made only vague public statements about the reason for firing Altman, saying that he was “not consistently candid in his communications with the board.”
But several people told CNN contributor Kara Swisher that a key factor in the decision was a disagreement about how quickly to bring AI to the market.
Altman, sources say, wanted to move quickly, while the OpenAI board wanted to move more cautiously.
This is where we begin to get into the real story lurking beneath the headlines.
***The most important detail of this drama
While most of the news reports centered around Altman, the OpenAI employees penning a letter demanding his return, and how Microsoft is involved, the real story is why the firing happened in the first place. The CNN explanation about a “disagreement” fails to capture the enormity of what happened.
Let’s go to Luke:
…These developments confirm something crucial. Truly powerful artificial intelligence – so-called “superintelligence” – is a lot closer than anyone thinks. And AI technology developments are progressing a lot faster than anyone thought possible.
In fact, it all comes back to the question: Why did OpenAI’s board push out Sam Altman in the first place?
Because the firm had just stumbled across a major AI breakthrough that was so powerful it frightened some members of the board – so much that they were willing to blow up the company to stop that AI from getting out.
Luke explains that in an interview two weeks ago, Altman said that sometime in early November, he was in the room when OpenAI made a major breakthrough that pushed the frontier of discovery forward. Altman called it just the fourth such breakthrough in OpenAI’s eight-year history.
Luke believes this breakthrough was likely the demonstration of GPT-5, the next evolution of OpenAI’s technology:
Reports suggest that this AI demonstration was so powerful that it created mixed feelings among OpenAI’s board. Some, like Altman, were excited about this new AI’s economic prospects. Others were frightened about its dangers.
It seems that internally, Altman and the board agreed to proceed carefully with this new AI. But Sam’s excitement got the best of him, and over the next few weeks, he went on a huge fundraising tour touting this new AI to top investors.
The board got worried he was moving too quickly and fired him.
Toward the end of last week, we learned more about the breakthrough that scared the board.
Ahead of OpenAI CEO Sam Altman’s four days in exile, several staff researchers wrote a letter to the board of directors warning of a powerful artificial intelligence discovery that they said could threaten humanity, two people familiar with the matter told Reuters…
OpenAI, which declined to comment, acknowledged in an internal message to staffers a project called Q* and a letter to the board before the weekend’s events…
Some at OpenAI believe Q* (pronounced Q-Star) could be a breakthrough in the startup’s search for what’s known as artificial general intelligence (AGI), one of the people told Reuters. OpenAI defines AGI as autonomous systems that surpass humans in most economically valuable tasks.
***Forgetting the corporate drama and focusing on the AI breakthrough, what are the implications?
According to Luke, the OpenAI drama we just witnessed will meaningfully accelerate the AI Boom over the next two years. We’re about to see Altman, OpenAI, and Microsoft make a huge push toward monetizing and commercializing their recent AI breakthrough. After all, their actions show that what they’re prioritizing is profits, not caution.
Back to Luke:
The reasons for Sam’s dismissal were of no concern to (to employees who wanted Altman reinstated, Microsoft, and Sequoia Capital).
And they didn’t care about the press release, which said Sam wasn’t “consistently candid” with the board.
They didn’t care that the board was doing what it felt was right to abide by its core mission – building AI that is good for all of humanity.
They cared about their investment, their money, their dollars – they cared about profiting off AI above all else…
They have lifted the veil. We can drop the disguise now…
These developments propelled us into Act II of the AI Boom – a rapid and immensely successful “profit push” that will transform AI from a concept into a series of world-changing products and services.
To Luke’s point, as this story was unfolding last week, Microsoft hit an all-time-high. Meanwhile, the Global X Artificial Intelligence & Technology ETF (AIQ) set a new 2023 high.
***With this as our backdrop, let’s turn our attention to tomorrow night
At 7 PM Eastern tomorrow night, Luke will be holding The 2023 AI Windfall Event. And to be clear up front, this is not about the next wave of AI stocks to buy today.
Now, there’s nothing wrong with that. In fact, if you’re a regular Digest reader, you know Luke spearheaded the charge into AI stocks this time last year. He’s been bullish all year, and many of his AI stock recommendations have surged triple digits since last fall.
But that’s not what tomorrow night is about.
The evening focuses on a different way to invest in AI that’s not on the radar of the average investor. However, it’s dead-center on the radar of many professional investors, not to mention the big money on Wall Street and Silicon Valley. That’s because it has the potential to produce 10X to 100x the returns of simple stocks.
Given this dramatic upside potential, the race to invest in AI in the way that Luke will detail tomorrow night is accelerating. As one Silicon Valley insider put it… the competition is becoming “vicious” because “everyone wants in.”
You’ll get all the details tomorrow night, with Luke even giving away – totally free – his top investment in this space. You can reserve your seat by clicking here.
I’ll give Luke the final word:
Believe it or not, the biggest fortunes in the AI Boom in 2024 will not be made in AI stocks.
They’ll make a different type of AI investment – one which historically outpaces stock returns by 14-to-1.
And tomorrow night at 7 PM Eastern, I am going to unveil these special AI investment vehicles for the first time ever in an emergency broadcast.
Click here to reserve your seat now.
Have a good evening,