This is The Takeaway from today’s Morning Brief, which you can sign up to receive in your inbox every morning along with:
OpenAI isn’t preparing for a public debut, at least not yet. With complex and seemingly insatiable financial needs, its executives are doubtless content without the obligations, disclosures, and instant quantifiable judgment that come with trading on the open market.
It is doing something in public, however, and at the very least is vying for broad public support as it pitches itself as a national strategic asset that the US government should cherish and protect. And so far, dealing with the public attention from its pitch has been somewhat of an ordeal.
Amid the advocacy, we’ve already seen a few minor PR snafus seemingly cause major stress for CEO Sam Altman and Co. Leave it to your imagination — or ChatGPT — to paint a picture of what the stress of regular reporting and inspection might do to the ambitious, talented, and financially stretched operation.
On stage at a Wall Street Journal event, OpenAI CFO Sarah Friar said that OpenAI is looking for Washington to provide loan guarantees to the world’s largest private company. After a brief backlash, Friar softened her stance in a LinkedIn post, walking back the remarks and clarifying that her use of the word “backstop” muddied the point.
To drive the point home further, Altman gave another C-suite clarification in a lengthy post on X Thursday, again denying his company is looking for a bailout.
So, to recap: OpenAI is now clearly stating it isn’t seeking a government backstop for its massive financial commitments.
The reaction to Friar’s initial comments and her and Altman’s apparent walk-back arrived at a touchy moment for OpenAI. In a podcast released last weekend, Altman was asked by investor Brad Gerstner how his startup could fulfill a pledge to spend more than $1 trillion when it generated roughly $13 billion in revenue this year. Instead of answering, Altman appeared to turn on Gerstner.
“Brad, if you want to sell your shares, I’ll find you a buyer,” Altman responded. “Enough.”
The clip, which has been widely shared online and features Microsoft CEO Satya Nadella laughing through the moment, as if to relieve the tension, hasn’t reflected well on Altman.
It’s important to note this wasn’t an adversarial interview between a working journalist and a tech exec, but a friendly podcast between business leaders with common financial interests. The question, and more basic versions of it, have been bouncing around the AI space for a while. How can AI companies spend so much with so little revenue?
