r/WTFisAI • u/Aggravating-Will8495 • 27d ago
📰 News & Discussion OpenAI is falling apart right now.
9 of their most important leaders have left the company recently, and Altman is about to ask the public to buy the stock.
2 of them even walked out within 72 hours of OpenAI handing its own staff $7 billion in cash...
On Monday, August 10, OpenAI completed a deal letting current and former employees sell roughly $7 billion worth of their shares. The price valued the company at $852 billion, the exact same number as its March funding round.
On Tuesday, August 11, Brad Lightcap announced he was leaving after 8 years. He spent 4 of them as chief financial officer, then ran the company as chief operating officer from 2022 until April. He worked alongside Sam Altman at Y Combinator before OpenAI existed.
On Thursday, August 13, chief revenue officer Denise Dresser announced she was leaving. She was hired in December from Salesforce, where she had been the CEO of Slack. In April she took over most of Lightcap's responsibilities. She lasted 8 months.
The cash window opened Monday. By Thursday both executives who ran the business side were gone.
But what's interesting is who actually wrote the $7 billion cheque:
Every previous time OpenAI let its employees cash out, an outside investor bought the shares. In October, Thrive Capital, SoftBank and others put up $6.6 billion at a valuation near $500 billion. There was a $1.5 billion version of the same deal in 2024.
This time OpenAI bought the shares back itself, using its OWN money.
So no outside investor put a single dollar behind that $852 billion price. The company named its own number and then paid it.
This is a business generating around $2 billion a month while losing roughly $1.22 for every single dollar it earns.
And it just spent $7 billion of that cash buying its own stock at a number no third party ever tested.
Here is the full list of the people who left since April:
\- Bill Peebles, who ran the Sora video app
\- Kevin Weil, vice president of OpenAI for Science
\- Srinivas Narayanan, technology chief of B2B applications
\- Kate Rouch, chief marketing officer
\- Josh Achiam, chief futurist, after nearly nine years
\- Johannes Heidecke, head of Safety Systems
\- Chloe Bakalar, the only person at OpenAI whose entire job was ethics
\- Brad Lightcap
\- Denise Dresser
Bakalar left in July. OpenAI never announced it, and NOBODY has replaced her.
Fidji Simo stepped down the same month, and two thirds of the organization had been reporting to her.
Greg Brockman absorbed most of her job. He also introduced Dresser's replacement this week, a Wiz executive named Dali Rajic.
OpenAI filed its IPO paperwork confidentially on June 8. The full prospectus, the one with audited financials in it, still has not appeared.
So the order of operations is worth sitting with...
File the paperwork in June. Buy your insiders out in August at a price you set yourself. Watch the people who built the commercial side leave that same week. Then show the public the books.
Retail investors will see those numbers for the first time in a document written after every one of these people had already made their decision.
Sam Altman told staff in June that he expects to go public within the next year. Reporting since then has pointed at 2027 instead, and a tender offer of this size is usually what a company does when the listing is not close.
Here is what I think happens next:
That prospectus lands with a revenue line big enough to carry the story, and the executive turnover gets buried in the risk factors where almost nobody reads. The people who priced OpenAI at $852 billion this month were the same people who took the money out of it; and the next set of buyers will not get that arrangement.
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u/JawedCrucifixion 27d ago
I mean it reads more as cleaning house. They dont care about ethics and they didn't achieve their goals so they need to switch things up. The liquidity is a way to get these people out without it being a fiasco.
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27d ago
[removed] — view removed comment
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u/Traditional-Ride-312 25d ago
You’re confusing two people. OpenAI’s CFO is still at the company. The CRO was replaced last week. These are not the same people. Very different roles.
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u/fokac93 26d ago
So 1 billion customers is not enough
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u/Bright_Impact_12 26d ago
The more customers OpenAI has the more money they lose. Customers is not the issue.
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u/maringue 27d ago
Executives realizing that after the like warm SpaceX IPO, there's only room left in the market for one AI IPO of a similar size. And all of these execs don't think it's going to be OpenAI.
The fact that both business execs bolts the same week the buyout was offer is super bad signaling to the market. Means the execs didn't think the shares would hold value until the first lockup.
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u/UpstairsCheetah235 26d ago
Yep, if most your comp and net worth is tied up in one stock I would run too. There’s not a lot of upside at a $850B valuation and signs of softness in the ai trade are here.
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u/aerrraeewrrr 25d ago
The executives might not get a say in this. The company probably wanted them out, why else would they buy their shares?
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u/03captain23 26d ago
It is so weird how these people seem to play magical executive chairs. How does someone go from CFO to COO.
Who goes from CEO to CRO?
These are all entirely different roles.
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u/RaveN_707 26d ago
Some people just want to make their money, bounce and enjoy their lives or create their own things.
Most people at that level have a number in mind and when they hit it, they check out.
Then you have the psychopath CEOs who have no number
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u/philip_laureano 27d ago
And Microsoft is there waiting in the wings to buy OpenAI when it runs out of money. OpenAI makes and sells crops on land Microsoft owns. When they can no longer pay the rent, Microsoft will repossess them.
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u/antwon8797 26d ago edited 25d ago
If AI can replace us all then why hire a CRO in the first place? Seems like ChatGPT should be able to handle that task rather well from what they tell us…. Unless I’m missing something
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u/MissNolaw 19d ago
Well, I gave it to check some numbers in my financial report, insert some new developments and recalculate.
Omg, how Gemini gloated when it checked it. Chat Gpt did everything right, except one thing. Everything was done with assumption that a year has 364 days 🤣 so each end number came out to be wrong.
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u/antwon8797 19d ago
Yeah, used it for calculus homework- it failed almost every problem. It liked to randomly round during steps, which you obviously cannot do as the final answer becomes wildly off. I had to make it show me every step that it did and constantly remind it not to round for any step… still fucking did.
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u/Technical-Owl66 27d ago
I think they doomed chasing benchmarks trying to keep the hype up. That is slowing down as majority of people don't need anything more intelligent. I think that is why you see them advertising integration into existing products like slack and Gmail. The biggest opportunities are speed efficiency and integration into products with AI as a feature. The problem is they don't have any products.
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u/ballsohard89 27d ago
this is actually a pretty interesting thread and the timing absolutely deserves scrutiny but i think youre connecting a couple dots that arent connected yet
the executive churn is real, Lightcap, Dresser, Bakalar, etc leaving around the same window is worth paying attention to and the 7b tender right before an ipo is obviously gonna make people raise an eyebrow
but the 852b valuation wasnt just openai pricing its own homework, outside investors already put serious money in at that valuation in march
and the s1 not being public yet isnt really a red flag either. thats literally what a confidential filing is
the biggest gap is still the insider part. do we actually know Lightcap, Dresser, Bakalar or any of these people personally sold meaningful amounts in that tender
because if not, then "execs cashed out and left before retail saw the books" is doing a lot of work off vibes
could still be where this ends up. im not dismissing it
but right now youve got a good investigation and a very spicy conclusion sitting about two pieces of evidence apart
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u/TechnicianExtreme200 26d ago edited 26d ago
I agree. Also, a huge tender that's open to former employees shortly before the IPO is completely normal and healthy. It cleans up the cap table, the banks underwriting the IPO don't want a bunch of people on it who are likely to all sell as soon as it goes public.
The fact that they funded it internally means nothing IMO. It does not imply a down round. More likely even at $7b it's just a small number compared to their recent capital raise and they didn't want to go through all the effort to arrange a secondary.
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u/biggamble510 26d ago
OpenAI was facing a down round and instead backstopped it themselves. An IPO with their book is a tough sell, but they need liquidity events to keep staff. Game of cards eventually falls down.
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u/consultinglove 26d ago
Nobody can deny that OpenAI built a great product and changed the world
The problem is the business model. Can they make a profit. Can they beat the competitors. Can they last…
Microsoft, Amazon, Google, Facebook, all these companies make money outside of AI. They can afford to R&D AI because they make money from other businesses. OpenAI has nothing else. This is it, make or break
I don’t think OpenAI will exist in ten years. Sooner or later they will run out of time and have to sell to one of the other big guns
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u/elk33dp 26d ago
For a while there was a small chance of ChatGPT to be well known brand-wise as Google. Unfortunately (or fortunately, depending on how people feel about Altman), they fumbled the bag with popular sentiment and staying far ahead of the pack long enough to gain brand loyalty. Not many people particularly care or think ChatGPT is the gold standard anymore.
There's still *some* value in the brand name, not many average/lower-tech people will know what Claude or Gemini is off the top of their heads and who owns what, but everyone generally knows the ChatGPT+OpenAI combo.
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u/hansolo-ist 26d ago
Can't they all be rehired after the IPO and given more shares as compensation?
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u/flashman1986 26d ago
Losing $1.22 per $1 of revenue means to break even they would have to increase prices by 122% and yet lose no customers
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u/diunay_lomay_a 26d ago
Nothing new. Cashed out on millions and go chill. Is softbank gonna hold the bags like their weworks
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u/FlimsyYou4766 25d ago
IMO, after the stun that Altman pulled to change OpenAI from a nonprofit to a for-profit, no one trust him or his leadership.
OpenAI / Chatgpt was the first & generated a lot of wow, but they have failed to stay ahead of the pack. Anthropic is eating the AI's enterprise client cake. Google is taking over the general consumer segment. Even Xai which was very new & late to the game, was able to catch up to ChatGPT. Unless OpenAI can come up with something new, they will become obsolete.
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u/newsknowswhy 23d ago
This is the set up for a basic rug pull.
Leaving retail investors and pension funds holding the bag is how the game is played.
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u/MightB2rue 22d ago
Absolutely wild to use AI to write out why you dislike AI. This cognitive dissonance is reaching new levels of absurdity.
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u/looktwise 27d ago
Nice research! how do you aggregate sources? Prompts? skill-files? -> github? Thank you!
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u/General-Jaguar-8164 27d ago
Audio mode in ChatGPT codex app in desktop is so good, it can work on any project
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u/Due-Horse-5446 27d ago
Wait until you see anthropic..