Happy Tuesday.
The current thing in tech and business is eBay rejecting GameStop’s offer to buy the company for $55B.
Today’s lineup𝕏 anon Doomberg at 11:30 AM
Forus Founder & CEO Sahir Jaggi at 12:00 PM
Monaco Co-Founder & CEO Sam Blond at 12:10 PM
A* Co-Founder & General Partner Kevin Hartz at 12:20 PM
Judgement Labs Co-Founder & CEO Alex Shan at 12:30 PM
Cinder Co-Founder & CEO Glen Wise at 12:40 PM
Condé Nast CEO at Roger Lynch at 1:15 PM
OpenAI vs Elon Musk Trial Enters Its Third Week
Sam Altman took the stand in the OpenAI v. Elon trial this morning. Just as a reminder, here’s what’s at stake, per WSJ:
Musk is suing OpenAI and its leaders, Altman and Greg Brockman, for allegedly manipulating him into giving tens of millions of dollars to a nonprofit organization, only for them to turn the AI lab into a for-profit venture. Musk is also suing Microsoft—OpenAI’s largest investor—for aiding Altman and Brockman in their alleged deception.
A big turning point in the trial was last Wednesday, when former OpenAI CTO Mira Murati and former board member Helen Toner gave testimonies about the events leading up to the November 2023 failed board coup that were critical of Sam Altman’s leadership style and candor.
But last week, OpenAI’s side also began to land some punches on Musk. Earlier testimony from Shivon Zilis and Greg Brockman had already suggested Musk was not just defending a pure nonprofit vision. He had explored scenarios where OpenAI might become part of Tesla, where Altman might help lead Tesla AI, and where Musk could retain deep control. Brockman also testified that Musk supported a for-profit conversion if Musk could control it, including a version tied to raising money for his Mars ambitions.
Yesterday, Microsoft CEO Satya Nadella and OpenAI cofounder Ilya Sutskever took the stand. Satya largely buffed OpenAI’s side, defending Microsoft’s partnership with the company, and saying that Musk never contacted him to complain about the deal violating any agreement Musk had with OpenAI’s nonprofit, despite Musk having Satya’s phone number. Ilya testified that he had spent a year compiling a 50+ page document documenting Sam’s manipulative behavior, but also said he never promised Musk that OpenAI would remain permanently nonprofit. Also it came out in the trial that Sutskever’s stake in OpenAI is probably worth around $7B, which probably complicated how the judge and jury feel about his own motivations.
So the story since Murati is: first, the trial became a referendum on Altman’s trustworthiness; then it became a referendum on whether the 2023 board was brave or incompetent; then Microsoft came in and tried to make itself look like the stabilizing partner. Now Altman has to personally answer the core question hanging over the whole case — whether OpenAI’s evolution was a necessary adaptation to build frontier AI, or a betrayal of the nonprofit mission Musk says he funded.
The trial is expected to conclude this week. You can follow along with Sam’s testimony today at NYT’s liveblog.
AI Lab Secondary Transactions Under Pressure
Yesterday, Anthropic updated a support page that essentially disavowed any secondary share transactions via SPVs and retail investment funds. “Invest at your own risk,” they wrote. “If someone offers you a way to participate, even on an indirect basis, in an investment in Anthropic, assume that it is invalid.”
OpenAI said pretty much the same thing in a new policy post yesterday. Any secondary transaction without OpenAI’s written consent “may result in the invalidation of the underlying equity,” they wrote.
Thinking Machines Drops “Interaction Models”
Mira Murati’s neolab Thinking Machines announced a research preview of interaction models yesterday. The video they released with the launch shows the models’ capabilities: they’re meant to speak and interact with you in real-time through voice, and respond to and recognize cues in your visual environment through a camera.
The main philosophy behind these models is that frontier AI has generally deprioritized a ‘realistic’ experience interacting with AI. Instead, people prompt AI and their agents in back and forth interactions, and by queuing them up with tasks, then leave the agent to complete the project on its own. By contrast:
We think interactivity should scale alongside intelligence; the way we work with AI should not be treated as an afterthought. Interaction models let people collaborate with AI the way we naturally collaborate with each other—they continuously take in audio, video, and text, and think, respond, and act in real time.
Mira’s announcement post explains a bit more behind her thinking.
EBay Rejects GameStop’s Unsolicited Takeover Bid
Calling GameStop CEO Ryan Cohen’s bid “neither credible nor attractive,” eBay rejected GameStop’s proposal to buy the company in a cash and stock deal worth $55B. In the rejection letter, eBay’s chairman Paul Pressler cited concerns about the ability for the deal to be financed and the amount of debt it would add to the company.
Last week, Ryan’s proposal went viral after an awkward appearance on Squawk Box, where he appeared standoffish and cagey about how he’d finance the deal. The next day, we interviewed him on TBPN — watch the full interview here.
BuzzFeed Sells to Byron Allen
Jonah Peretti is stepping down as CEO and will serve as BuzzFeed’s President of AI as part of a deal where entrepreneur Byron Allen will take a 52% stake in the company for $120M. Allen will become CEO of BuzzFeed. From NYT:
On the conference call, Mr. Allen said he planned to expand BuzzFeed’s efforts in streaming and user-generated content, an industry term for video not made by company employees. He also said BuzzFeed would add local coverage to its national and international news articles on HuffPost, a site BuzzFeed bought in 2020.
Allen will remain CEO of Allen Media Group, which owns local TV stations and the Weather Channel.
HeadlinesThinking Machines releases interaction models
NYT: EBay Rejects GameStop’s $55 Billion Takeover Bid
WSJ: SpaceX and Google Are in Talks to Launch Data Centers in Orbit
WSJ: OpenAI CEO Sam Altman Takes Stand in Elon Musk Megatrial
Bloomberg: AI Dictation Startup Wispr in Funding Talks at $2 Billion Value
Variety: Byron Allen Is Buying BuzzFeed, Will Become CEO
Isomorphic Labs raises $2.1B in Series B funding led by Thrive Capital
Hacker News: Mini Shai-Hulud Worm Compromises TanStack, Mistral AI, Guardrails AI & More Packages
FT: Amazon staff use AI tool for unnecessary tasks to inflate usage scores
Bloomberg: Korea Roils Market by Floating ‘Citizen Dividend’ From AI
WSJ Opinion: Seattle Turns Hostile to the Great Businesses It Made
OpenAI releases Daybreak, frontier AI for cyber defenders
Havoc raises $100M in Series A funding
NBC News: Diet Coke parties are all the rage in India as aluminum can shortage bubbles up
Zach Shore takes over as CEO of Hermeus
NYT: Start-Up Raises $1.3 Billion for an A.I. ‘Grid’
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