Elon Musk just put in a massive $97.4 billion bid to buy OpenAI through a team of investors including Valor Equity Partners, Vy Capital, 8VC, Baron Capital, and Atreides Management. His first order of business? Renaming it to ClosedAI.
This isn’t just about acquiring the company – Musk wants to pull OpenAI back to its original open-source mission that he helped establish when co-founding it in 2015. He stepped down from the board in 2018 over disagreements about the company shifting toward a for-profit model.
The timing is interesting. OpenAI was valued at $157 billion last October and could hit $300 billion in their next funding round. Meanwhile, Musk’s own AI company xAI landed a $50 billion valuation in November.
Sam Altman, OpenAI’s CEO, responded with classic snark on Twitter: suggesting OpenAI might buy Twitter if Musk wants to sell it for $9.74 billion.
The core issue here is pretty clear – Musk thinks OpenAI betrayed its founding principles by prioritizing profits over open-source development. The name change proposal to ClosedAI hammers that point home pretty bluntly.
I think this move reveals deeper tensions in AI development between open collaboration and proprietary technology. OpenAI started as a nonprofit focused on beneficial AI for humanity but transformed into a company that keeps its tech under wraps.
Whether or not this bid succeeds, it highlights a key question for AI companies: Can you balance open research and innovation with the need to monetize and control valuable AI technology? So far, most are choosing control over openness.
For more context on the shifting AI industry landscape, check out my analysis of other major AI developments in my post about Google’s Gemini 2.0 Pro launch: https://adam.holter.com/google-launches-gemini-2-0-pro-a-look-at-their-most-powerful-ai-model/
