Investment implications of the OpenAI saga based on the current fact pattern: OpenAI will slow down. It seems like the safety faction won. As they should have - the board of OpenAI’s overwhelming *fiduciary* duty was to safety. It will probably take 3-9 months for the new research lab at Microsoft to approximate where OpenAI is today. Unlikely that they can flip a switch and immediately having a GPT-4, and perhaps more importantly, a GPT-5 working tomorrow. @DrJimFan who is one of the most knowledgeable observers, estimates 9 months for GPT-4 equivalence for the new lab. Important that the board of OpenAI can dissolve the commercial agreement whenever they agree AGI has been attained. And some hints that there are those at OpenAI who believe this is imminent (see recent comments from Sam and Ilya tweet). Stated simply, if the board believes GPT-5 to be AGI, then Microsoft has zero rights to GPT-5. While possession is 9/10 of the law, they would be open to a lawsuit if they took advantage of GPT-5’s residence in Azure to take control of it. It is now a wide-open race to surpass GPT-4 and approximate the putative GPT-5. Microsoft and Google will both be driving hard to surpass GPT-4. Reality is that an in-house lab led by Sam and Greg might be better for Microsoft than the existing arrangement given the AGI clause. However, large companies are more cautious than startups, so will likely go slower than OpenAI’s previously torrid pace. I suspect Grok will end up being a common destination for many of the OpenAI engineers who do not go to Microsoft, given that Elon was instrumental to recruiting the original team as an OpenAI co-founder. All of this may be better than regulations for helping to ensure a multipolar AI world, which is the most important outcome as a human. This is likely to effectively create a pause and allow others to catch up. All of the drama increasingly *seems* to have been sparked by some combination of GPT-5 being more powerful than expected (i.e. AGI is/was possible in 2024) and *perhaps* some freelancing by Sam with respect to raising money for OpenAI affiliated hardware/semiconductor companies. “Not consistently candid” was strong language. Essential to remember that the board’s fiduciary duty was to the non-profit and AI safety. I would not be so quick to dunk on the OpenAI board. I have known @adamdangelo for nearly a decade and I assess him as a very principled, data driven person. The board is under immense pressure and I would not discount the fact that many OpenAI employees were going to sell in the 90b secondary round - which is unlikely to happen unless Sam and Greg come back. Also strange that so many invested in OpenAI, when its board had *zero* fiduciary obligations to the for-profit subsidiary. Governance matters. And if the existing board resigns as per the employee letter this morning, then the new board will have the *exact* same fiduciary obligation to the safety focused mission of the non-profit. And changing this would create all sorts of problems related to the original transition from pure non-profit to “capped profit” company controlled by Microsoft. This is why the new lab may actually be better for everyone except the employees of OpenAI who were set to make tens of millions in the secondary sale. And while I feel for them, I am also confident they are going to make a lot of money wherever they go over the next 1-2 years. Obviously all these thoughts are subject to change if new facts emerge. When the facts change, I change my mind.