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OpenAI experiences major reorganization, Sam Altman no longer manages Startup Fund
OpenAI has taken Sam Altman out of the leadership position of its investment fund. The OpenAI Startup Fund, which has amassed $175 million from collaborators like Microsoft, puts money into early-phase companies in diverse fields such as healthcare, law, and education that are powered by AI.
OpenAI has modified the management arrangement of its venture capital fund that aids AI-based startups, taking away the authority of its well-known CEO, Sam Altman, over the fund. This update has been disclosed in a document filed with the US Securities and Exchange Commission (SEC), as mentioned by Axios.
The OpenAI Startup Fund, which was set up in 2021, initially named Altman as its chief. But this setup caused some worries, especially following Altman's short-lived removal from his position as the CEO of OpenAI in November.
Despite Altman's reinstatement, the fact that he owned the fund could have caused problems for the company. A representative clarified that Altman did not have any financial stakes or personal investments in the fund, even though he was identified as its manager.
The changes noted in the filing dated March 29, deal with the unique setup of Altman's ownership of the fund. Despite being promoted like a corporate venture arm, Altman sourced the funds from outside limited partners and personally handled investment decisions. OpenAI explained that irrespective of his ownership, Altman doesn't hold a financial stake in the fund.
The OpenAI Startup Fund, which has garnered $175 million from collaborators like Microsoft, channels its investments into emerging companies that are powered by AI, spanning industries like healthcare, law, and education.
Last year, the fund experienced a growth in pledges, now possessing a gross net asset worth of $325 million, as reported in an SEC filing.
Ian Hathaway, who has been a partner at the fund since 2021, has now taken over the management of the fund. Altman has stepped down from his role as a general partner.
Hathaway, who has been in charge of the fund's accelerator program and spearheaded investments in a number of firms such as Harvey, Cursor, and Ambience Healthcare, now takes control.
Even though Altman is no longer involved in the management of the fund, his previous investments outside of OpenAI, particularly in cryptocurrency and fusion technology, have attracted attention.
Nonetheless, a separate inquiry carried out after Altman's provisional dismissal in November determined that he was not at fault concerning product safety or OpenAI's financial matters.
(Incorporating information from various sources)
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