Investors' wrath proves too strong for OpenAI's board.

On Friday, the board of OpenAI, known for its popular AI creations like ChatGPT, made a surprising move by ousting its CEO, Sam Altman. This decision, however, didn't sit well with many involved with the company, from investors to employees, due to Altman's significant influence in Silicon Valley.

By Saturday evening, reports began surfacing that discussions were underway to possibly reinstate Altman as CEO, prompted by reactions from key stakeholders. Microsoft CEO Satya Nadella, whose company is a major partner and investor in OpenAI, was reportedly blindsided and unhappy with the news of Altman's departure. He has since been in contact with Altman, indicating support.

Further, some of OpenAI's venture capital backers, including Khosla Ventures and Reid Hoffman, who were not informed of the board's decision in advance, are now reportedly considering legal action. Vinod Khosla of Khosla Ventures expressed his support for Altman on Twitter, emphasizing Altman's significance as a leader.

Microsoft's involvement is particularly crucial due to their substantial financial commitment to OpenAI, much of which is yet to be fulfilled. Their control over this funding gives them significant leverage over OpenAI, especially as the startup faces growing operational costs.

Meanwhile, the internal response at OpenAI has been tumultuous. Following the board's decision, Greg Brockman, OpenAI's president and co-founder, resigned. This was followed by the departure of three senior researchers, including the director of research and the head of preparedness. More resignations are reportedly underway.

The situation is seen by many as a power struggle within the board, particularly involving Quora CEO Adam D’Angelo and Ilya Sutskever, with concerns over Altman’s commercial focus for the company. Despite the board's rationale, the tech community's overwhelming support seems to favor Altman.

As the board reconsiders its position, Altman and Brockman are reportedly engaging with investors about a new venture focusing on AI chips. With OpenAI's future and employee stock sale in limbo, the board faces a challenging reversal of its decision, highlighting the complex dynamics of power and influence in the tech world.