alt Hacker NewsMicrosoft didn't sell anything. OpenAI created more shares and sold those to investors, so Microsoft's stake is getting diluted.
And Microsoft only paid $10B for that stake for the most recognizable name brand for AI around the world. They don't need to "hedge their bets" it's already a humongous win.
Why let Altman continue to call the shots and decrease Microsoft's ownership stake and ability to dictate how OpenAI helps Microsoft and not the other way around?
Replies
do we know whether Microsoft could have been selling secondary shares as part of various funding rounds?
my impression is that many of these "investments" are structured IOUs for circular deals based on compute resources in exchange for LLM usage
About the same as they wasted on Nokia.
I think people are looking for excuses to declare OpenAI and Anthropic teetering on the brink of failure when the actual reality is… they are wildly successful by absolutely any measure. This deal is proof. If Microsoft didn’t believe in OpenAI they wouldn’t have restructured it this way. They’d have tightened their reins and brought in “adult supervision”
> They don't need to "hedge their bets" it's already a humongous win.
That's a flawed argument. Why wouldn't you want to hedge a risky bet, and one that's even quite highly correlated to Microsoft's own industry sector?