OpenAI, the company behind Generative AI tool ChatGPT that helped usher in the era of artificial intelligence, plunged itself into chaos over the weekend by ousting CEO Sam Altman and then unsuccessfully tried to bring him back.

In a shock announcement on Friday (US time), OpenAI’s small board said it sacked Altman, the public face of a company that has achieved unrivalled popularity over the past 12 months and has seen its perceived value shoot above US$80 billion.

“Mr Altman’s departure follows a deliberative review process by the board, which concluded that he was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities,” OpenAI said in a statement.

“The board no longer has confidence in his ability to continue leading OpenAI.”

The surprise announcement rippled through the tech world as Altman had been a ubiquitous figure during this year’s heady discussions about AI safety and the powerful technology’s role in society.

On X, Altman said he loved working at OpenAI. “It was transformative for me personally, and hopefully the world a little bit,” he said. “Most of all I loved working with such talented people.”

Up in the air

OpenAI quickly fell into crisis following its board’s decision.

Within hours, company president Greg Brockman had resigned and three of its senior staff – Jakub Pachocki, director of research; Alexksander Madry, head of preparedness; and research scientist Syzmon Sidor – had walked out the door.

On social media, staff began posting heart emojis in a show of solidarity with Altman that was reportedly a signal of their willingness to follow him to a new company.

Prior to this weekend, Altman and Brockman sat on the OpenAI board along with Quora CEO Adam D’Angelo, GeoSim CEO Tasha McCauley, AI safety expert Helen Toner, and fellow co-founder Ilya Sutskever who has since publicly expressed regret for his role in ousting Altman.

Seeing their staff and key figures follow Altman to the exit – and pressured by investors like Microsoft which poured US$10 billion into OpenAI – the board considered walking back its decision.

Ultimately, after two days of negotiations, OpenAI and Altman couldn’t agree on a way forward together.

The board chose Emmett Shear – co-founder of streaming site Twitch which he sold to Amazon in 2014 – as interim CEO following failed negotiations with Altman.

Microsoft, meanwhile, swooped in to pick up the pieces with CEO Satya Nadella confirming the company’s commitment to OpenAI on X.

“We’re extremely excited to share the news that Sam Altman and Greg Brockman, together with colleagues, will be joining Microsoft to lead a new advanced AI research team,” Nadella said.

“We look forward to moving quickly to provide them with the resources needed for their success.”

‘You are incapable of overseeing OpenAI’

Upon returning to work on Monday, OpenAI staff revolted against their employer as over 500 staff signed a letter calling for the board to resign and threatening to follow Altman and Brockman over to Microsoft.

“Your actions have made it obvious that you are incapable of overseeing OpenAI,” the employee letter wrote,” as re-published by Wired. “We are unable to work for or with people that lack competence, judgment and care for our mission and employees.”

OpenAI started as a non-profit dedicated to researching artificial general intelligence with the purpose of building a system that “benefits all of humanity”.

The company originally had a strong focus on AI safety – famously, OpenAI refused to release an early version of its large language model for fear of the harm it would cause – but has since sold the fruits of its research as an expanding suite of GenAI products.

While its for-profit arm is busy raking in money, OpenAI is still beholden to its roots through the non-profit board, meaning investors like Microsoft have limited say in how the company operates.

This tension between the commercial and non-profit elements of OpenAI were reportedly at the heart of the split between the company and its CEO.

Only two weeks ago, Altman was on-stage at OpenAI’s first developer conference, introducing a store that would let customers easily create their own custom GPTs.

He has also reportedly been working with former Apple designer Jony Ive on creating AI hardware and was a significant investor in Humane, the company that recently showed off its AI Pin.

Altman has been in talks with venture capitalists to raise money for a company that would make dedicated AI chips in order to rival NVIDIA.