$100b for Open AI - Elon’s Latest Chess Move

Elon Musk throwing a $100B valuation at OpenAI isn’t just another tech headline. It’s a calculated move in what’s becoming Silicon Valley’s spiciest drama.

Remember when OpenAI was born? It was supposed to be this noble non-profit, working to create artificial general intelligence (AGI) that would benefit all of humanity. Elon was right there at the start, co-founding it with Sam Altman with this whole “let’s democratize AI” vibe.

Fast forward to now, and things got… complicated. Elon bounced, bought Twitter (sorry, “X”), and created his own AI company (XAI) with Grok — which, to be fair, is pretty impressive since it can roast you with up-to-the-minute memes from X.

OpenAI’s been getting cozy with Microsoft — to the tune of a $13B+ investment. Then there was that wild week in November when Sam got fired, almost joined Microsoft, then came back like nothing happened (that’s a whole other Netflix series waiting to happen).

Now Sam wants to turn OpenAI into a for-profit company, and Elon’s basically saying “Not so fast, my friend” with this $100B valuation move.

Transitioning from a non-profit to a for-profit isn’t like flipping a switch. The non-profit board needs to be compensated fairly, and Elon just set the price tag astronomically high.

The plot twist? Sam apparently has no equity in OpenAI and claims he doesn’t care about the money. (says while driving car worth over $3.5 million)

Side bar: Understanding Open vs. Closed AI

The distinction between open and closed AI goes beyond simple access. Open-source AI makes model weights, architecture, and sometimes training data publicly available. Closed-source AI, exemplified by OpenAI’s GPT-4, keeps these elements proprietary and accessible only through controlled interfaces.

Meta’s Llama 3.1, currently the world’s largest open-weight model, demonstrates this complexity — while its weights are freely available, the training data remains proprietary. Similarly, xAI’s Grok, despite Musk’s advocacy for openness, initially launched as a closed-source model exclusive to X Premium+ subscribers.

Where the Major Players Stand — The industry is clearly divided:

Let’s read between the lines:

• Elon’s playing 4D chess, using the valuation to potentially block or complicate the transition
• Microsoft’s probably not thrilled about this development
• The original mission of open-source AGI is hanging in the balance
• The non-profit board is suddenly looking at numbers with a lot more zeros

This isn’t just about money — it’s about the future of AI development, and who controls it. Elon Musk’s $100 billion valuation, whether a serious offer or a strategic maneuver, highlights the immense power struggle at play. Is it a genuine attempt to keep OpenAI aligned with its original mission, a power play to gain influence, or simply a way to disrupt Microsoft’s growing dominance? Whatever the motivation, the outcome of this battle will have profound implications for the AI landscape.

The stakes are incredibly high, and the players are making their moves.

About the author: @rizpabani writes about Exponential Technologies like AI. You can learn more about our work by visiting www.exponentialpartners.io