Speaker 1: It's a Wednesday in November twenty twenty three. I'm standing
Speaker 1: in a dark restaurant in San Francisco. There are a
Speaker 1: few dozen people. It's the after party for an AI conference.
Speaker 1: People are standing and chatting in small circles. Waiters are
Speaker 1: bringing trays of arderubs around. I'm biting into a tiny
Speaker 1: Porcini mushroom doughnut when I hear a whisper. Sam Altman
Speaker 1: has walked into the restaurant. I try to spot him
Speaker 1: in the dim lighting. I've talked to Sam here and
Speaker 1: there over the years. He's been around the startup scene
Speaker 1: for more than a decade, and he's friendly to journalists
Speaker 1: and over time, Sam Altman has become basically the most
Speaker 1: Silicon Valley man alive. He's the CEO of open Ai,
Speaker 1: which shot to tech startum a year ago with the
Speaker 1: release of chat GPT. His company is worth eighty six
Speaker 1: billion dollars. It's one of the most valuable startups in
Speaker 1: the world. For the past six month months, Sam had
Speaker 1: been everywhere. It seemed like every major news outlet wanted
Speaker 1: to profile him, and he was saying yes to each one.
Speaker 1: Headlines referred to him as the chat GPT King, the
Speaker 1: Oppenheimer of our age, and an AI overlord. He was
Speaker 1: like an ambassador for the AI future, zipping around the.
Speaker 2: Globe meeting with world leaders.
Speaker 1: He testified in front of Congress and amid all that
Speaker 1: he decided to pop by this AI conference party a
Speaker 1: little surprise visit. So I see him standing in a
Speaker 1: corner of the restaurant. A few people have already clustered
Speaker 1: around him. I decide to say hi. He's wearing a
Speaker 1: suit and a tie, more dressed up than usual, and
Speaker 1: he's shorter than I remember. We shake hands. He eyes
Speaker 1: my conference badge and says, it's good to see you.
Speaker 1: I'm surprised by how personable he is, how friendly he
Speaker 1: comes across. He acts like he remembers me. He already
Speaker 1: knows I'm working on this podcast. So I say to him,
Speaker 1: I'm about to put in a request to your comms
Speaker 1: team to see if we can find a time to
Speaker 1: interview you. He's like, sure, sounds good. Several people are hovering,
Speaker 1: hoping to get his attention for a minute, so I
Speaker 1: step away, and after about ten minutes at the party,
Speaker 1: he leaves too. The next day, Sam continues his tour
Speaker 1: as the Statesman of AI. He speaks at APEC, a
Speaker 1: big conference at President Biden and China's leader Shijin being
Speaker 1: both attended. Here's Sam at that conference talking about AI.
Speaker 3: I think this will be the most transformative and beneficial
Speaker 3: technology humanity has yet invented. I think this is like
Speaker 3: the greatest weep forward of any of the of the
Speaker 3: big technological revolutions we've had so far. So I'm super excited.
Speaker 3: I can't imagine anything more exciting to work on, and
Speaker 3: getting to do that is like the professional honor of
Speaker 3: a lifetime. It's so fun to get.
Speaker 1: To work on that, the most transformative technology humanity has
Speaker 1: yet invented, the professional honor of a lifetime. Sam clearly
Speaker 1: believes the world is about to change dramatically and fast,
Speaker 1: and he's aware that a lot of that change is
Speaker 1: connected to him. And the day after that, less than
Speaker 1: forty eight hours after I saw Sam at that party,
Speaker 1: less than twenty four hours after he spoke at a
Speaker 1: major international gathering of world leaders, he was fired.
Speaker 4: Breaking news. Sam Altman is out as CEO of OpenAI.
Speaker 2: This is a stunner.
Speaker 5: The tech world has been thrown into chaos over the
Speaker 5: weekend when the company that gave us chat GPT fired
Speaker 5: it's CEO. The move came as a complete surprise to everyone,
Speaker 5: including open AI's biggest investor.
Speaker 3: Microsoft board says it pushed Altman out after a review
Speaker 3: found he was quote not consistently candid in his communications
Speaker 3: with the board.
Speaker 1: It's hard to emphasize enough how shocking this was. Sam
Speaker 1: Altman got fired. It was the juiciest tech news of
Speaker 1: the year and completely unexpected. The news came on a
Speaker 1: Friday afternoon, and my colleagues and I all immediately knew
Speaker 1: our weekends were out the window. The next few days
Speaker 1: felt like a hurricane of news. The board implied Sam
Speaker 1: had lied to them. They announced a new CEO. Then
Speaker 1: came a regretful public apology by someone who had fired Sam.
Speaker 1: There were pledges of loyalty, an employee revolt, and at
Speaker 1: the same time something else was happening. It started to
Speaker 1: seem like Sam was actually going to come back. He
Speaker 1: was rallying the support of his employees and Microsoft. It
Speaker 1: was looking like Sam could win. On Tuesday night, Sam
Speaker 1: was reinstated as CEO at the company that just five
Speaker 1: days earlier had basically tried to destroy him. Sam managed
Speaker 1: to get the upper hand once again. It was high drama,
Speaker 1: a jaw dropping turn of events, but for those who
Speaker 1: know Sam, it actually made perfect sense. One of Sam's
Speaker 1: mentors is an investor named Paul Graham. He once told
Speaker 1: a reporter Sam is extremely good at becoming powerful. To me,
Speaker 1: this seems like Sam's defining characteristic. Often in Silicon Valley
Speaker 1: we talk about tech visionaries who are programming geniuses or
Speaker 1: obsessed with the details and design of the product. That's
Speaker 1: not Sam. His strongest, most unique skill is wielding power,
Speaker 1: and that might have consequences for all of us. You're
Speaker 1: listening to Foundering, I'm Ellen Hewitt. In this season of Foundering,
Speaker 1: we're going to chronicle the rise of Sam Alman, the
Speaker 1: all out arms race to build the leading AI company,
Speaker 1: the claim that this new technology could threaten to wipe
Speaker 1: out all of humanity if we're not careful, and then
Speaker 1: the coup that almost took down the guy at the
Speaker 1: top of it all before he managed to.
Speaker 2: Claw his way back.
Speaker 1: For this season, you'll hear reporting done by me and
Speaker 1: my colleagues at Bloomberg who have been covering AI during
Speaker 1: the boom of the last few years. We interviewed some
Speaker 1: of the leading minds in AI to try to cut
Speaker 1: through the hype and understand the debate about whether AI
Speaker 1: will be a tool to improve human existence or to
Speaker 1: extinguish it. But this is also the story of Sam,
Speaker 1: the man at the center of it all, and we
Speaker 1: spoke with Sam's friends, family, and collaborators to demystify him
Speaker 1: and how he rose to power. This first episode is
Speaker 1: all about how Sam got here. He's a man who
Speaker 1: has always understood the importance of being in the right
Speaker 1: room at the right time, with exactly the right few people.
Speaker 1: The full story of Sam's rise is important because understanding
Speaker 1: who he is and what he believes will shed light
Speaker 1: on an earth question should we trust this man to
Speaker 1: oversee this technology? In the summer of twenty twenty three,
Speaker 1: about five months before he was fired, my colleague Emily
Speaker 1: Chang asked him this exact question at a Bloomberg conference.
Speaker 6: You have an incredible amount of power at this moment
Speaker 6: in time.
Speaker 2: Why should we trust you?
Speaker 3: You shouldn't If this really works, it's like quite a
Speaker 3: powerful technology, and you should not trust one company, and
Speaker 3: certainly not one personalize it.
Speaker 1: You shouldn't trust me. If he believes that, then why
Speaker 1: did Sam fight his way right back to the top
Speaker 1: of Open AI, back into that position of control, as
Speaker 1: if to insist he should be the person to lead
Speaker 1: this company as they develop AI as fast as possible.
Speaker 1: To a lot of people, the stakes are terrifying. They're
Speaker 1: higher than anything else really in the valley. Some people
Speaker 1: refer to Artificial General intelligen or AGI as the last invention,
Speaker 1: something so potent that everything that comes after will look
Speaker 1: unrecognizable compared to everything leading up to it. Inside Open AI,
Speaker 1: some employees talk about how they are building God.
Speaker 2: We'll be right back.
Speaker 1: To get a better sense of the kind of person
Speaker 1: Sam is and how he got where he is now.
Speaker 1: I want to take you back to his adolescence. Sam
Speaker 1: had a privileged upbringing in Saint Louis. He's the oldest
Speaker 1: of four siblings. His mom was a dermatologist and his
Speaker 1: dad was a real estate developer. He attended a private
Speaker 1: high school called John Burrows. There's an anecdote about him
Speaker 1: from that period that sticks out. When some students wanted
Speaker 1: to boycott an assembly about sexuality, Sam stood up in
Speaker 1: front of the whole school and announced he was gay.
Speaker 1: It's a pretty gutsy move for a teenager in the
Speaker 1: early two thousands, and unsurprisingly, Sam smart.
Speaker 7: And generally Sam he was. He was an exceptional student,
Speaker 7: He was an exceptional writer, he was an exceptional big personality.
Speaker 1: That's Andy Abbott. He was one of Sam's English teachers,
Speaker 1: and he's now the head of school. And this is
Speaker 1: a pretty nerdy school where it's cool to get good
Speaker 1: grades and be a high achiever. And even in that environment,
Speaker 1: Sam stood out.
Speaker 7: Sam's just a really natural leader, incredibly charismatic, curious guy.
Speaker 7: He's a typical you know. He was the editor of
Speaker 7: the yearbook and he represented the school in the Model
Speaker 7: United Nations. He designed our website, you know, before we
Speaker 7: hired people to do our website. He could just do
Speaker 7: that stuff.
Speaker 2: Sam even played water polow.
Speaker 7: He was pretty good. I'm not a connoisseur, but I'm like,
Speaker 7: he was pretty good.
Speaker 1: He remembers Sam as being really confident, and apparently for
Speaker 1: good reason. Sounds like Sam was just this exceptional kid.
Speaker 7: Well, he's the smartest guy in the room, and he's charismatic.
Speaker 7: I remember thinking, and I'm just this is just an
Speaker 7: embarrassing confession. I hope he doesn't go into technology. He's
Speaker 7: so creative and he's so, he's such a good writer,
Speaker 7: and I hoped he would be an author or something
Speaker 7: like that. And I mean, nobody could have anticipated the
Speaker 7: magnitude of open Ai, but everybody knew that this guy's
Speaker 7: better at most things than most of us are.
Speaker 1: This speaks to a pattern that'll become a crucial factor
Speaker 1: in Sam's career. He's very good at impressing people, especially
Speaker 1: the right people, older people, people with influence, people who
Speaker 1: are at a position to help him. Someone who knows
Speaker 1: Sam says his superpower is figuring out who's in charge
Speaker 1: and charming them. So we have young Sam. Even though
Speaker 1: he was a teenager, he acted like someone older with
Speaker 1: more agency and confidence. Adults found this quality of his admirable,
Speaker 1: and he acted like this toward his three younger siblings too.
Speaker 1: In a big New Yorker profile on Sam, his younger
Speaker 1: brother said that as kids, they used to play a
Speaker 1: board game called Samurai, and Sam always won because he
Speaker 1: declared himself the leader and said, I have to win
Speaker 1: and I'm in charge of everything. When Sam's brother told
Speaker 1: this story, it was a jocular exchange. But Annie, their
Speaker 1: youngest sibling and only sister, sees it differently. These days,
Speaker 1: she's estranged from Sam and the rest of her immediate family,
Speaker 1: but when she was a kid, she remembered that same
Speaker 1: quality of Sam's wanting to be in charge, and to
Speaker 1: her it wasn't funny, it was domineering.
Speaker 8: From my perspective, with nine year age difference, he very
Speaker 8: much wanted to be and acted like the third parent
Speaker 8: and like being the older sibling in charge, in control.
Speaker 1: For instance, even though the family was Jewish, they used
Speaker 1: to get a Christmas tree until Sam put his foot down.
Speaker 8: I don't have memories of Christmas tree because when Sam
Speaker 8: got farmits food at thirteen, he decided that we as
Speaker 8: a family unit were Jews and needed to no longer
Speaker 8: celebrate Christmas.
Speaker 2: There were no more Christmas trees.
Speaker 1: When their dad passed away in twenty eighteen, Annie remembers
Speaker 1: that Sam dictated to each of his younger siblings how
Speaker 1: many minutes they could talk at the funeral.
Speaker 8: To be at your dad's funeral, to be like, oh,
Speaker 8: I'm the oldest sibling, so I get to choose how
Speaker 8: long all the sibling which it is bizarre, and there's
Speaker 8: a level of it that's so hilarious and so benign.
Speaker 8: Surface level, classic older sibling bullshit where it's like, all right,
Speaker 8: older sibling wanting to make.
Speaker 2: Up the rules to the game.
Speaker 8: Like there's a level of it that's very light and funny,
Speaker 8: and there's also a level of it that's very dark
Speaker 8: and deeply unsettling of how does that behavior come up
Speaker 8: in other places if you believe that you get to
Speaker 8: be the authority on something that you are not the
Speaker 8: authority on.
Speaker 1: A spokeswoman for open Ai told us that Sam recalls
Speaker 1: these incidents differently, but she declined to elaborate. And so
Speaker 1: when Sam finished high school, he started down this path
Speaker 1: that's pretty textbook for the tech industry, studying computer science
Speaker 1: at Stanford, founding a startup, and dropping out of Stanford,
Speaker 1: and he made one incredibly important decision he applied to
Speaker 1: why Combinator. Why Combinator is a startup accelerator. It's basically
Speaker 1: a boot camp for startups. You and your co founders
Speaker 1: apply and if you're accepted, you spend three months hacking
Speaker 1: away trying to build a company. At the end of
Speaker 1: that period, you give a demo to investors and try
Speaker 1: to raise venture capital. Sam was actually in the first
Speaker 1: ever group of founders at y Combinator. Everyone calls it YC.
Speaker 1: By the way, it was two thousand and five, so
Speaker 1: YC was totally unknown, just a bunch of young guys
Speaker 1: hanging out in Cambridge, Massachusetts for a summer writing code.
Speaker 1: But WYC would eventually become this enormously powerful network. Now
Speaker 1: it's basically the number one elite program for startups. It's
Speaker 1: really hard to get in, and the alumni network is
Speaker 1: incredibly strong. Sam was nineteen years old when he joined YC,
Speaker 1: and once again he impressed just the right person, Paul Graham,
Speaker 1: the head of YC. The first batch included some other
Speaker 1: really impressive people, like the founders of Reddit and Twitch,
Speaker 1: but someone who knows Sam says that he was immediately
Speaker 1: Paul's favorite. Paul later wrote, within about three minutes of
Speaker 1: meeting him, I remember thinking, ah, so this is what
Speaker 1: Bill Gates must have been like when he was nineteen.
Speaker 1: The startup Sam was building was called Looped. Looped is
Speaker 1: one of the forgotten apps of its time the early
Speaker 1: two thousands, when people were really excited about having GPS
Speaker 1: on their phones for the first time. It used location
Speaker 1: data to connect people to their friends and local businesses,
Speaker 1: kind of like a mix of Yelp, and four Square.
Speaker 1: Here's Sam making the pitch at a developers conference.
Speaker 9: Luped is about connecting with people on the go, which is,
Speaker 9: after all, the main reason you have a phone. We
Speaker 9: show you where people are, what they're doing, and what
Speaker 9: cool places are around you.
Speaker 1: Sam started building the startup in two thousand and five.
Speaker 1: The iPhone didn't exist yet, so Looped was trying to
Speaker 1: do this for flip phones and it was kind of
Speaker 1: hard to get traction. At one point early on, Sam's
Speaker 1: company was in a desperate situation. They really needed to
Speaker 1: get a deal with a mobile carrier. They learned that
Speaker 1: Boost Mobile, which was part of Sprint, was looking to
Speaker 1: add a location feature and needed a partner, but they
Speaker 1: were about to sign with someone else, so Sam flew
Speaker 1: down to Boost's headquarters in Irvine in southern California. When
Speaker 1: he tells the story, he says that he just showed up,
Speaker 1: waited outside the right executive's office, and asked for just
Speaker 1: ten minutes. Here's how that executive remembers it.
Speaker 6: It's ever recall I got a phone call from Sam
Speaker 6: and he was in Irvine, and he said that he
Speaker 6: explained who he was and what Looped was somebody at
Speaker 6: Sprint had told him to get in touch with us.
Speaker 1: That's Lowell Winer. He was at the time the head
Speaker 1: of business development for Boost. And he's going to tell
Speaker 1: a story that has a few asides, but that I
Speaker 1: think captures a lot about what Sam was like.
Speaker 6: Early on, we were a day or two away from
Speaker 6: signing a contract with another startup that was further along
Speaker 6: than Looped. He asked to come by that day, you know,
Speaker 6: which is incredibly unusual, but given the timing that, you know,
Speaker 6: we were at the eleventh hour we were at to
Speaker 6: sign this contract. He had come, you know, referred to
Speaker 6: us by our parent company, it was worth at least
Speaker 6: a meeting. So Sam shows up at the office with
Speaker 6: one of one or two other guys from Looped. We
Speaker 6: go sit in the conference room, you know, we share
Speaker 6: what we were looking to do. Sam started to share
Speaker 6: about Looped. He was I think nineteen at the time,
Speaker 6: you know, I think maybe in cargo short sitting cross
Speaker 6: legged in a in a chair in the conference room
Speaker 6: and just kind of holding court.
Speaker 1: I want to pause here for a second on this
Speaker 1: cargo shorts detail. For a lot of Sam's young life,
Speaker 1: he was a cargo shorts. Devotee wore them all the time.
Speaker 1: People kind of poked fun at him for it, to
Speaker 1: the point where he felt the need to address it
Speaker 1: on a podcast called Masters of Scale.
Speaker 3: Honestly, I don't think they're that ugly, and I find
Speaker 3: them incredibly convenient. Like I I, you can like put
Speaker 3: a lot of stuff like I like to. I'd still
Speaker 3: read paperback books. I like paperback books. I like to
Speaker 3: carry on around with me. I have like an iPhone
Speaker 3: seven plus, which is kind of like works really well
Speaker 3: in cargo pockets. I carry like computer chargers, cables. They're
Speaker 3: just like, you know, efficient. Why people care about that
Speaker 3: so much that I can't.
Speaker 1: Tell you that last comment? That's very Sam to remark
Speaker 1: that the things normal people might talk about don't make
Speaker 1: sense or aren't rational. It's like he has no patience
Speaker 1: for the things most of us might think are funny.
Speaker 1: He has more important things to think about anyway. Here
Speaker 1: he is a nineteen year old in a meeting with
Speaker 1: mobile network executives wearing cargo shorts, sitting cross legged in
Speaker 1: a conference room chair. Even though this encounter was almost
Speaker 1: twenty years ago, Lowell remembers vividly what Sam looked like
Speaker 1: in that moment, because it was such an odd picture.
Speaker 6: He's a he was small in stature. I don't think
Speaker 6: he's a big guy now, but he was. You know,
Speaker 6: he was quite slim at the time. You know, it's
Speaker 6: no easy feat to sit cross legged in a conference chair.
Speaker 6: I mean, he looked like he could have still been
Speaker 6: in high school.
Speaker 1: I've heard other people describe Sam's weird way of sitting.
Speaker 1: He's older now, so he doesn't do it as much,
Speaker 1: but one person who knows him told me he used
Speaker 1: to squat on the seat of a chair like a
Speaker 1: perched bird, with his knees up toward his chin. Despite
Speaker 1: this unconventional way of presenting himself or because of it,
Speaker 1: he almost immediately convinced Lowell that boost Mobile should switch
Speaker 1: plans at the eleventh hour and go with this other partner.
Speaker 6: It was pretty clear within a half hour of this
Speaker 6: meeting starting that Luked and Sam were the right partner
Speaker 6: to do this. There was both excitement and like, shit,
Speaker 6: we have to go sell it internally. But I recall
Speaker 6: stepping outside of the room with the colleague that I
Speaker 6: was in the meeting with and saying to him, we
Speaker 6: need to switch gears.
Speaker 1: And Lowell still remembers this way that Sam looks unassuming,
Speaker 1: but he's not.
Speaker 6: On the one hand, visually he looked incredibly young, but
Speaker 6: if you'd shut your eyes and were just listening to him,
Speaker 6: his command of material and his ability to communicate and
Speaker 6: engage was on par with anyone you know I had
Speaker 6: met with over the course of my tech career. It Uh,
Speaker 6: it was freakish. Yeah, it was screakish, and not his appearance,
Speaker 6: but his his poise and command for.
Speaker 1: That age, Sam's relentlessness paid off. He knew he had
Speaker 1: to get that deal, and he did what he needed
Speaker 1: to do to get it, including flying across the state
Speaker 1: to surprise someone at their office. Sam later said he
Speaker 1: learned an important lesson the way to get things done
Speaker 1: is to just be really persistent. So he inks this
Speaker 1: deal for Looped, it's going to power location sharing for
Speaker 1: boost Mobile. It's the partnership that led to this two
Speaker 1: thousand and six ad campaign.
Speaker 6: Oh you see where I meant here, but I know
Speaker 6: where you at Poop Slooped the GPS.
Speaker 7: Now you know where your friends.
Speaker 1: At Sam's peers at YC were surprised that he pulled
Speaker 1: this off. Lup's business model was pretty wobbly and the
Speaker 1: product wasn't all that impressive, but Sam's particular strength was
Speaker 1: starting to become clearer.
Speaker 4: It was obvious Sam was an incredible deals guy.
Speaker 1: That's a clip from a podcast interview with Emmett Sheer,
Speaker 1: one of the other guys in that very first YC batch.
Speaker 1: You can hear how impressed he was by Sam's particular talent.
Speaker 4: He was somehow convincing the phone companies to give his
Speaker 4: startup that like didn't really have a product like deals.
Speaker 4: I still don't know how he did that, And like
Speaker 4: that was the only obvious thing about Sam at the time,
Speaker 4: was like that he was ambitious, but most of us
Speaker 4: were pretty ambitious, and he was great at great great
Speaker 4: deals guy.
Speaker 1: For the next few years, luped kept growing. Sam presented
Speaker 1: at Apple's Developer Conference into thousand and eight in a
Speaker 1: very unique outfit. He wore two polo shirts layered on
Speaker 1: top of each other, so he's in a hot pink
Speaker 1: polo with a second lime green collar poking out underneath.
Speaker 4: I'd like to invite up Sam Altman, Sam K.
Speaker 9: Scott, we are incredibly psyched about lupt on the iPhone.
Speaker 9: Luped is about connecting with people and what cool places
Speaker 9: are around you. The orange pin up there is where
Speaker 9: I am right now, and the blue pins represent my friends.
Speaker 9: We make serendipity happen.
Speaker 1: And when you listen to Sam pitching Loot, you can
Speaker 1: hear this other part of him, this earnestness and optimism.
Speaker 1: I've listened to and read a lot of interviews with
Speaker 1: Sam and he's always using the words super and excited,
Speaker 1: sometimes super excited.
Speaker 3: It's super cool, super easy to make, super important. It's
Speaker 3: been super great.
Speaker 9: I'm super excited to announce.
Speaker 3: I'm super excited, super excited for that.
Speaker 1: But he was not super excited about what happened next
Speaker 1: at lut. After several years, Looped fizzled out. Sam made
Speaker 1: a deal to sell the company for a modest sum
Speaker 1: in twenty twelve. He walked away with a reported five
Speaker 1: million dollars. Most people would be pretty happy with this outcome,
Speaker 1: but in Silicon Valley terms, Loop twa was kind of
Speaker 1: a failure. But that's okay because by then Sam had
Speaker 1: won over other people who could help him. One was
Speaker 1: Peter Teel, who was a billionaire, an investor, and the
Speaker 1: co founder of PayPal and Palanteer. He's also one of
Speaker 1: the most powerful gay men in Silicon Valley, which lent
Speaker 1: him and Sam a sense of camaraderie. When Sam left looped,
Speaker 1: Peter gave him a bunch of money to invest. They
Speaker 1: were close, and Sam's peers noticed because Peter Teel is
Speaker 1: notoriously pessimistic and even nihilistic, and Sam's public image, by contrast,
Speaker 1: is pretty earnest and optimistic. At the same time, Sam
Speaker 1: was deepening his relationship with Paul Graham, the head of YC,
Speaker 1: and that closeness was giving Sam tangible benefits. When Paul
Speaker 1: had the chance to invest very early on in Stripe
Speaker 1: the Payments startup, he invited Sam to invest too. Sam
Speaker 1: later said that that was by some measures, his most
Speaker 1: profitable angel investment ever, and he got it purely because
Speaker 1: of this personal relationship he had built. Paul is known
Speaker 1: for writing essays about how to build startups, essays filled
Speaker 1: with blunt, quotable entrepreneurial wisdom. Often in those essays he
Speaker 1: praised Sam. He advised young eager founders to emulate Sam,
Speaker 1: and Paul is also responsible for one of the most
Speaker 1: infamous quotes about Sam. You could parachute him into an
Speaker 1: island full of cannibals and come back in five years
Speaker 1: and he'd be the king. At first, this quote sounded
Speaker 1: to me like a compliment, but lately I've wondered if
Speaker 1: maybe it's not anyway. Around twenty twelve, Why had become
Speaker 1: very influential. It had relocated its headquarters from Cambridge to
Speaker 1: Silicon Valley and was now a breeding ground for some
Speaker 1: of the most successful Internet businesses. Airbnb, Dropbox, and Stripe
Speaker 1: all got their start at YC, and from the outside
Speaker 1: it looked as though Sam was beginning to mimic Paul
Speaker 1: as a startup guru. He was also advising young founders
Speaker 1: at YC, and just like Paul, he started writing essays
Speaker 1: filled with mysterious, often perplexing advice for startup founders, such
Speaker 1: as the most successful founders do not set out to
Speaker 1: create companies. They are on a mission to create something
Speaker 1: closer to a religion or here's another A big secret
Speaker 1: is that you can bend the world to your will
Speaker 1: a surprising percentage at the time, most people don't even try.
Speaker 1: In a blog post called how to Be Successful, Sam
Speaker 1: told founders that they should quote have almost too much
Speaker 1: self belief. The most successful people I know believe in
Speaker 1: themselves almost to the point of delusion. That last point
Speaker 1: will sound familiar to people who know Sam. One of
Speaker 1: them told me that Sam has complete self belief. That
Speaker 1: Sam gives off the impression that he believes in himself
Speaker 1: one hundred percent without that nagging feeling most of us have,
Speaker 1: like a little voice of fear or uncertainty. And here's
Speaker 1: Lowell again, the former boost Mobile executive.
Speaker 6: He was extraordinarily self assured, and not in an egotistical way,
Speaker 6: but just very comfortable with himself, with his capacity both
Speaker 6: intellectually and relationally.
Speaker 1: For years, Paul had built up Sam's image, made him
Speaker 1: this kind of startup demigod. Then he decided to anoint
Speaker 1: him fully. Paul stepped down in twenty fourteen and named
Speaker 1: Sam President of YC.
Speaker 2: This was a big deal.
Speaker 1: YC is the center of Silicon Valley, and now Sam
Speaker 1: was its leader. He was twenty eight years old. With
Speaker 1: both Peter Teel and Paul Graham, Sam cultivated these close
Speaker 1: relationships with people and positions of power. Then they gave
Speaker 1: him things like money, connections, influence titles. Essentially, they transferred
Speaker 1: some of their power directly to him, and that in
Speaker 1: turn gave Sam the ability to think big. Even when
Speaker 1: he was working on something pretty silly sounding like looped,
Speaker 1: Sam had sky high ambitions. Paul noticed this. Here he
Speaker 1: is at a conference explaining why he picked Sam to
Speaker 1: be his successor at YC.
Speaker 3: It's turned into this giant thing and I'm no good
Speaker 3: at running giant things.
Speaker 4: Sam, however, is going to be good at running a
Speaker 4: giant thing.
Speaker 1: At this point, there was no evidence Sam could run
Speaker 1: a giant thing or even a medium sized thing. But
Speaker 1: once he took over, Sam did make YC much bigger
Speaker 1: than before sprawling. He gave more money to more startups,
Speaker 1: and he expanded overseas.
Speaker 10: The Sam Altman era at YC was about expansion.
Speaker 1: That's John Coogan. He's a startup founder who went through
Speaker 1: YC twice, including ones for his company Soylent, you know,
Speaker 1: the one that made food powder for tech people.
Speaker 10: Why C went from you know, a summer program for
Speaker 10: startups with just a couple companies to doing all sorts
Speaker 10: of things, venture investing with the Continuity Fund, nonprofit work
Speaker 10: with YC research. There's definitely a there's a feeling of like, Okay,
Speaker 10: how much should YC really be doing? Should this organization
Speaker 10: be doing everything.
Speaker 1: During his time at YC, John noticed a couple things
Speaker 1: about Sam.
Speaker 10: He's very good at switching gears and listening very intently.
Speaker 10: I think that's what's really that's really like a superpower.
Speaker 10: I heard someone describe him as the Michael Jordan of listening.
Speaker 1: A lot of people have described this intensity of Sam's
Speaker 1: to me. When he listens, he also stares. It can
Speaker 1: almost feel unsettling. And now that Sam was running YC,
Speaker 1: he could become kind of a covert operator. He had
Speaker 1: all of his deal making skills from his Loop days,
Speaker 1: and now his network and influence was way bigger. If
Speaker 1: there was ever a problem, he could make a call
Speaker 1: and fix it fast.
Speaker 10: Early, very early in my business career, I had a
Speaker 10: very tough negotiation going on, and I wrote Sam this
Speaker 10: email saying like, Hey, I'm in this negotiation. I just
Speaker 10: want to reality check some stuff with you, and he
Speaker 10: called me immediately. We talked for like five minutes and
Speaker 10: he completely solved my problem, and it was like one
Speaker 10: of the best business deals in my life. It was like,
Speaker 10: actually left a really really like big impact on me.
Speaker 10: I've personally seen Sam resolve a one hundred million dollar
Speaker 10: issue in a thirty minute phone call, fifteen minute phone call.
Speaker 10: It's really remarkable, and I think Sam just thinks about
Speaker 10: it in human terms. It's like, this person wants X,
Speaker 10: this person wants why. How can we bring these two
Speaker 10: people together.
Speaker 1: YC was growing, but Sam's ambitions were even larger. When
Speaker 1: he became president, he started taking on pet projects. One
Speaker 1: of his interests was nuclear fusion. To encourage more people
Speaker 1: to build startups in this area, he expanded yc's scope
Speaker 1: to include hard tech startups, that is, companies building tech
Speaker 1: where there's some doubt that it'll work at all. Until
Speaker 1: that point, YC had been almost exclusively about Internet software.
Speaker 1: He also spun up a research arm at YC and
Speaker 1: assigned researchers to projects he wanted to explore. One example
Speaker 1: was universal basic income. The idea is to give every
Speaker 1: person a regular income, regardless of whether they work. So
Speaker 1: under Sam's command, YC created a study to give money
Speaker 1: no strings attached to families in Oakland. This move is
Speaker 1: one that Sam turns too often. He'll have an idea
Speaker 1: for something he thinks should exist, and then he pulls
Speaker 1: in people and money to encourage someone to do it.
Speaker 1: Bending the world to his will. As he wrote in
Speaker 1: his blog, he's kind of like the maestro of an orchestra,
Speaker 1: not playing the instruments himself, but conducting his symphony. And
Speaker 1: in twenty fifteen he'll have the chance to do this again,
Speaker 1: this pattern of finding an important topic, then arranging to
Speaker 1: get the right people and the right money on board
Speaker 1: to build it. This time the focus is AI. It'll
Speaker 1: all take place at a dinner. At dinner, that'll change everything.
Speaker 2: We'll be right back.
Speaker 1: Okay, here's a bit of Silicon Valley lore. It's often
Speaker 1: told that in twenty fifteen Elon Musk was worried, or
Speaker 1: at least Elon was going around telling everyone he was
Speaker 1: deeply distraught over the state of artificial intelligence. Back then,
Speaker 1: the biggest powerhouse in AI was Google. It had so
Speaker 1: much money, and it had hired all the best researchers.
Speaker 1: They had Google Brain, and then they acquired deep Mind.
Speaker 1: It's a British lab that was working on some of
Speaker 1: the most exciting things in AI at the time, AI
Speaker 1: that could be more fluid and self taught. Google's early
Speaker 1: lead particularly disturbed Elon because he was worried about the
Speaker 1: possibility that AI could start to grow too powerful, especially
Speaker 1: if an AI entity began to improve itself, and he
Speaker 1: was really worried about the guy in charge of it all.
Speaker 11: So I used to be close friends with our page,
Speaker 11: and I would say at his house and we'd have
Speaker 11: these conversations long into long into the evening about AI,
Speaker 11: and I would I would be constantly urging him to
Speaker 11: be careful about the danger of AI, and and he
Speaker 11: just he was really not concerned about the danger of
Speaker 11: AI and was quite cavalier about it.
Speaker 1: That's Elon on CNBC. I'm always surprised by how catual
Speaker 1: he sounds when he's telling the story of basically ending
Speaker 1: a friendship. But he loves this anecdote because it makes
Speaker 1: him sound smart and forward thinking.
Speaker 11: And at the time, Google, especially after their acquisition of
Speaker 11: deep Mind, had three quarters of the world's AI talent.
Speaker 11: They had obviously a lot of computers and a lot
Speaker 11: of money. But the person who controls that does not,
Speaker 11: or at least that did not seem to be concerned
Speaker 11: about AI safety. That sounded like a real problem. So
Speaker 11: and then the final straw was Larry calling me a
Speaker 11: specist for being pro human consciousness instead of machine consciousness.
Speaker 11: And I'm like, well, yes, I guess I am.
Speaker 1: At the time, a lot of experts thought the idea
Speaker 1: of developing AI so powerful and that it threatened the
Speaker 1: human species was laughable because AI was still having trouble
Speaker 1: distinguishing between a picture of a chihuahua and a picture
Speaker 1: of a blueberry muffin. But to Elon it was a
Speaker 1: real threat. Here he is speaking with Walter Isaacson at
Speaker 1: a conference. He sounds serious, even alarmed.
Speaker 11: I don't think most people understand just how quickly machine
Speaker 11: intelligence is advancing. It's much faster than almost anyone realizes.
Speaker 11: Even within Silicon Valley, people really have no idea.
Speaker 7: Why is that dangerous?
Speaker 11: If there's some digital superintelligence, particularly if it's engaged in
Speaker 11: recursive self improvement, and its optimization or utility function is
Speaker 11: something that's detrimental to humanity, then it will have a
Speaker 11: very bad effect.
Speaker 6: You know.
Speaker 11: It could be just something like getting rid of spam
Speaker 11: email or something, and it's like concludes, well, the best
Speaker 11: way to get over spam is to get rid of humans,
Speaker 11: you know, But why would we lose source of all spam.
Speaker 6: I know we've all watched Howl in two thousand and one.
Speaker 1: The audience actually laughed at him because what he was
Speaker 1: saying sounded so outlandish. At the time, Elon was increasingly
Speaker 1: feeling like he had to do something to dilute Google's power,
Speaker 1: but he might have also been driven by something else.
Speaker 1: Here's Ashley Vance, my colleague at Bloomberg, who wrote a
Speaker 1: biography of Elon twenty thirteen.
Speaker 12: Elon was He was not the guy we know today.
Speaker 12: I mean, he was doing okay, but Tesla was kind
Speaker 12: of just barely starting a hitted stride. SpaceX was doing
Speaker 12: pretty well. Elon was worth probably a few billion dollars.
Speaker 12: Definitely not the richest person in the world.
Speaker 1: Elon's friends at the time were among the richest people
Speaker 1: in the world, Larry Page and Saragey Brinn, the co
Speaker 1: founders of Google.
Speaker 12: I was interviewing Elon a lot then, I was working
Speaker 12: on a book about him, and it was clear to
Speaker 12: me that he was looking over at his friends who
Speaker 12: were doing really well and everything they did, and they
Speaker 12: had these software empires and this growing AI empire. And
Speaker 12: my sense of where Elon's thoughts about AI started to
Speaker 12: originate was part jealousy. I thought he looked at Google
Speaker 12: and all the success it was having and the success
Speaker 12: as friends were having and he had nothing like that.
Speaker 12: But he would never admit this out loud that he
Speaker 12: was jealous.
Speaker 1: Okay, So AI was top of mind for Elon, and
Speaker 1: in twenty fifteen he attended this dinner at the Rosewood Hotel.
Speaker 1: It's this swanky place on sand Hill Road in Menlo Park,
Speaker 1: right near some of the biggest venture capital firms in
Speaker 1: the valley. There were about ten people at this dinner,
Speaker 1: but for our purposes, here are the four most important ones.
Speaker 1: There's Elon, There's Sam. Then there are two other people,
Speaker 1: Ilia Sitskiver and Greg Brockman. Ilia worked at Google. It
Speaker 1: was a really well respected researcher in AI, and Greg
Speaker 1: had been one of the most important people at Stripe,
Speaker 1: taking it from a team of five people to a
Speaker 1: company worth billions of dollars. At dinner, they talked very
Speaker 1: seriously about AI and the threat that it could be
Speaker 1: misused or that it could lead to catastrophe. They talked
Speaker 1: about what it might take to build something that could
Speaker 1: compete with Google. They had the pieces there. Ilia's AI skills,
Speaker 1: Greg's operational experience, Elon's money, and Sam was there to
Speaker 1: orchestrate it all. At that dinner, Elon pledged to put
Speaker 1: a billion dollars towards this project. He came up with
Speaker 1: the name too. You can hear the pride in his
Speaker 1: voice when he describes the idea on CNBC.
Speaker 11: Open ai refers to open source, So the intent was,
Speaker 11: what's the okay? So what was the opposite? What's the
Speaker 11: opposite of.
Speaker 2: Google?
Speaker 11: Would be an open source nonprofit because Google is closed
Speaker 11: sourced for profit, and that profit motivation can be potentially dangerous.
Speaker 1: So that's the birth of open ai. They had an
Speaker 1: initial vision. Open ai would be a research lab and
Speaker 1: it would share its work openly with the public instead
Speaker 1: of trying to keep it private for its own gain.
Speaker 1: And it would be a nonprofit not focused on enriching
Speaker 1: the company, but instead focused on building a safe AI
Speaker 1: that would benefit humanity. It sounds good in theory, but
Speaker 1: those nonprofit open source ideals were about to get complicated fast.
Speaker 1: Open Eye's co founders soon found themselves locked in a
Speaker 1: power struggle and then urgently racing to raise billions of dollars,
Speaker 1: and Sam would come out on top again in a
Speaker 1: way that cemented his power even further. That's next time
Speaker 1: on foundering. Foundering is hosted by me Ellen Hewitt. Sean
Speaker 1: Wen is our executive producer. Molly Nugent is our associate producer.
Speaker 1: Blake Maples is our audio engineer, Mark Million and vandermain
Speaker 1: seth Fiegerman, Tom Giles and Molly Schutz are our story editors.
Speaker 1: We had production hell up from Jessica Nix and Antonio mufferetch.
Speaker 1: Thanks for listening. If you like our show, leave a
Speaker 1: review and most importantly, tell your friends.
Speaker 2: See you next time.