> got their equity vaporized

Did anyone have equity though? I thought they (at least some) had some profit sharing agreements which I assume would only be worth something if OpenAI was ever profitable?

There was a tender offer for employee shares valuing the company at $87b that was pulled because of this. Those would’ve been secondary share purchases by Thrive but gave employees a liquidity event. Now that’s off the table.

OpenAI was guaranteed to be profitable, extremely so, if they just continued down the path Sam layed out like a week ago.

Now its guaranteed to generate 0 profits, so all that 'profit share/pseudoequity' is worth nothing.

> OpenAI was guaranteed to be profitable, extremely so,

Was it though? I'd agree that it was almost guaranteed to have a very high valuation. However profitability is a slightly different matter.

Depending on their arrangements/licensing agreements/etc much of those potential profits could've just went to MS/Azure directly.

> Now its guaranteed to generate 0 profit

Literal fan fiction

Developing, training, and running AI models is not cheap, and it's very much an open question of whether the money users are willing to pay covers the cost.

> who just got their equity vaporized

You've just pointed out the big issue with a non-profit. There is no equity to vaporize, so no one is kept in check with their fantastical whims. You and I can say 'safe AI' and mean completely different things, but profitable next quarter has a single meaning.

All of the employees work for (and many have equity in ) for a for-profit organization which is owned partially by the non-profit who controls everything and Microsoft. The non-profit is effectively a shell to overview the actual operations and that's it.

There was no outcome from this where substantial amounts of equity weren't vaporized.

It's difficult to see how that would have been a surprise.

What equity?

The "there was no equity, because it was a non-profit" argument is stressing the term.

At least Microsoft thought it bought something for $13B.

When a wealthy person gives a museum much money and get a seat on the board of trustees - does that also mean that they "bought the museum"?

They didn't buy nothing. See things museums and institutions will do for wealthy donors, that they won't do for anyone else.

I'm not saying that wealthy donors don't get anything. Wealthy donors don't own the museum, just because they provided funding to the museum.

Just as wealthy donors to medical research don't get to own the results of the research their money funded.

Just as Microsoft doesn't get to own a part of Linux, for donating to The Linux Foundation.

Etc...

OpenAI is definitely on the "less" side of charity.

"OpenAI PPUs: How OpenAI's unique equity compensation works"

https://www.levels.fyi/blog/openai-compensation.html