OpenAI removes Sam Altman's ownership of its Startup Fund • Hacker News Board

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#41

Post by lurker919 » Tue, Apr 02, 2024, 12:21 AM UTC

nicklecompte wrote: post #34

DalasNoin wrote: post #30

Earlier quoted context omitted.

I feel like this is more interesting than the original post. Though I am not sure what I am supposed to make out of this: is it 1. shady operations using fake identities with their signatures or 2. an early example of OAI trying to use AI for making money through investments? I lean towards the first one. I mean maybe there is an explanation which makes this seem more reasonable. Do people create boards with fake dir…

The Substack was badly written, and it took me a long time to figure out what their point was. And I might be wrong! I got lost in the purple prose. Regardless of how shady OpenAI's aims may have been, I genuinely think the root cause of this is that someone at OpenAI foolishly used ChatGPT to automate boring tax paperwork. ChatGPT decided "John Q Vesper" or whatever was a statistically plausible name for the CEO, an…

Hilarious!

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#42

Post by nongaap » Tue, Apr 02, 2024, 12:54 AM UTC

nicklecompte wrote: post #34

DalasNoin wrote: post #30

Earlier quoted context omitted.

I feel like this is more interesting than the original post. Though I am not sure what I am supposed to make out of this: is it 1. shady operations using fake identities with their signatures or 2. an early example of OAI trying to use AI for making money through investments? I lean towards the first one. I mean maybe there is an explanation which makes this seem more reasonable. Do people create boards with fake dir…

The Substack was badly written, and it took me a long time to figure out what their point was. And I might be wrong! I got lost in the purple prose. Regardless of how shady OpenAI's aims may have been, I genuinely think the root cause of this is that someone at OpenAI foolishly used ChatGPT to automate boring tax paperwork. ChatGPT decided "John Q Vesper" or whatever was a statistically plausible name for the CEO, an…

Fun fact: I consider myself a pretty bad writer and initially started the newsletter to try and get better at it. The results have been mixed on that front so apologies if you got confused by the "purple prose". I'm trying.

Anyway, my point was:

1. The disclosures point to "OpenAI Startup Fund I" being under the control of a fake company and CEO.

2. The fake company and CEO in question looks like the creation of an AI hallucination.

3. If a fake company and CEO were intentionally used by OpenAI, this isn't a minor infraction and there are highly consequential ramifications to consider given Altman's prior "ownership" of the fund, reported concerns it was being used to circumvent OpenAI Board oversight/governance, and participation in the fund was allegedly a means to invest in OpenAI.

Much of the piece is admittedly a helter-skelter collection of disclosures and explanations focused on supporting #1 and I don't really get into my rationale for #3.

Overall, it makes for bad long-form reading, but it did compel BI to do the needed journalistic follow-up work, made OAI acknowledge the filing was "illegitimate", and pushed the story forward.

We now know, according to OpenAI:

1. The company and CEO doesn't exist to their knowledge. 2. The document indicating this fake company and CEO controlled "Fund I" isn't legitimate and completely fabricated. 3. They're not willing to elaborate/explain how or why these "fabricated" entities got filed by them.

It's ugly spaghetti prose, but I'd say the write-up worked as intended.

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#43

Post by llm_nerd » Tue, Apr 02, 2024, 1:20 AM UTC

propter_hoc wrote: post #7

I'm not a lawyer, but I've been involved in a fair bit of venture fund formation. A fund is not an incorporated entity, but rather a partnership of two persons. In a limited partnership, one of those persons is the general partner and does all the work and assumes the related liability, and the rest are "limited partners" who just commit capital. Banks and tax authorities only open accounts for actually-formed partne…

You might be simplifying, but just to clarify an LP can have many general partners and many limited partners.

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#44

Post by uptime » Tue, Apr 02, 2024, 1:21 AM UTC

nongaap wrote: post #33

notahacker wrote: post #24

Earlier quoted context omitted.

There's... a lot of other stuff that turns up on Google, including GPT chatbots associated with "Vespers Inc" that claim to help people with online filing, name overlaps with people who had genuine court cases filed against them in California several years ago, a defunct and obviously spammy Vespers Inc LinkedIn AI and Cybersecurity profile, and a Github profile of a "Governmental Forensic Fraud Investigator that sha…

Hi, author of "GP Hallucination" here. I think the linked interpretation is very, very reasonable and it's a big reason why I tried to deemphasize all the "stuff" you've highlighted in my piece. I think most of us would agree the person in question - if they're real - is exhibiting signs of a mental health crisis. That said, I wouldn't have written the piece if I felt the aforementioned interpretation was the primary…

I just want to comment that the image of the Santa Ana property looks a lot like the main character’s apt in the movie Momento, adding some umami to the whole vibe.

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#45

Post by yieldcrv » Tue, Apr 02, 2024, 3:56 AM UTC

lgregg wrote: post #31

yieldcrv wrote: post #18

Earlier quoted context omitted.

None of this makes sense in a Master-Feeder model, as the master fund is a partnership between the feeder funds, one US, one offshore for foreign investors The general partner is not an owner they are a manager. The general partner doesnt have to be a human either it can be another entity or multiple entities all of this can be hotswapped Even in a mini-master models or single US entity model, LPs are the owners, GP…

Where can you go to learn more about these entity / LP / LLP setups that finance orgs use?

be rich enough to be a limited partner, means you're rich enough to have your own specialized lawyer to review the contract (instead of "I know a guy" "my cousin" "prepaid legal" "general counsel"), rich enough to afford an MBA, rich enough to do a dry run in setting up your own hedge/vc/pe fund

otherwise, I don't know exactly. but I've personally been reading wiki pages on fund structures since I was 18 and not eligible for anything, just dissecting the quiet class systems I noticed. scouring SEC documents, and validating my assumptions with hedge fund lawyers and being an LP when I could afford it later

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#46

Post by babyshake » Tue, Apr 02, 2024, 4:10 AM UTC

baobabKoodaa wrote: post #27

makestuff wrote: post #6

"OpenAI has said Altman does not have financial interest in the fund despite the ownership." Can someone explain how this could be true?

Sometimes I wonder exactly how much financial engineering a "non profit" entity is supposed to need...

You have it backwards. The non profit is part of the financial engineering, not the other way around.

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#47

Post by hackernewds » Tue, Apr 02, 2024, 4:16 AM UTC

thinkingemote wrote: post #19

paxys wrote: post #9

Earlier quoted context omitted.

It simply means he didn't put his own money into the fund.

Might it therefore imply that he seeks to put others but not his own money into the fund? Or does it imply that he has no intention of profiting from the fund?

why is it so outlandish that it could be the latter?

Re: OpenAI removes Sam Altman's ownership of its Startup Fund

#48

Post by ameister14 » Wed, Apr 03, 2024, 8:13 PM UTC

lgregg wrote: post #31

yieldcrv wrote: post #18

Earlier quoted context omitted.

None of this makes sense in a Master-Feeder model, as the master fund is a partnership between the feeder funds, one US, one offshore for foreign investors The general partner is not an owner they are a manager. The general partner doesnt have to be a human either it can be another entity or multiple entities all of this can be hotswapped Even in a mini-master models or single US entity model, LPs are the owners, GP…

Where can you go to learn more about these entity / LP / LLP setups that finance orgs use?

I went to law school to do that, but without that you can start by focusing on an area of law called "business associations/corporations." There are resources online to assist law students studying for exams in that class so you can use those to get a grounding in the concepts of agency law and partnerships.

From there you can start to specialize in more specific structures by examining the filings of public companies or scouring the web to figure out how a particular fund you are interested in is structured.

To let you know, it is further complicated in US law by each state having different corporate rules. If you go with Delaware or New York it's probably your best bet for public, but closely held or private companies could be anywhere. As a starting place, most states adopt the Revised Uniform Partnership Act, or RUPA - that is available online through law.cornell.edu