What Are The Long-Term Implications Of The OpenAI Chaos On The Tech Ecosystem?

By Yael Benjamin

The tech ecosystem was in a frenzy the past few weeks, as Sam Altman was unexpectedly fired from his role as CEO of OpenAI. However, within just a few days, Altman was reinstated as CEO and a seemingly happy ending concluded the drama.

Despite Altman’s swift return, is all really back to normal in the ecosystem? Or will the ripple effect of the recent events only come to light down the line, hurting future development of new AI technologies and innovations?

To provide some visibility into this question, at Startup Snapshot we collected data from more than 160 global tech stakeholders, including startup founders, investors and corporate innovation players. The data, which was collected in partnership with Intel Ignite, Consiglieri and the Zell Entrepreneurship Program, highlighted the many question marks about the longer-term effects of the saga on the AI ecosystem.

“The way in which the tech community was blindsided, and the zig-zagging that the media obsessively covered, could not have come at a more fragile time for OpenAI, and generative AI is a whole,” explains Adam Hanft, an adviser to Startup Snapshot and a strategy and brand consultant to leading startups. “It demonstrates that old-fashioned rivalries and internal politics pose a risk to both technology and social impact. It will not be soon forgotten, as the complex governance structure of OpenAI will now be deeply examined; the ripple effect will continue for a long while.”

Effect on OpenAI’s position in the tech ecosystem

The majority of respondents believe that the recent events will affect OpenAI’s position in the tech ecosystem, ranking it 6.9 on a scale of 1-10, with 1 (won’t hurt OpenAI’s position) to 10 (will definitely hurt OpenAI’s position).

This is due to an increase in perceived risk, with 54% of respondents reporting they perceive an increased risk associated with using OpenAI products following the recent events. This indicates that rather than promising a stable future, more than half believe the drama will continue or have long-term implications.

According to Tzahi Weisfeld, vice president and general manager of Ignite: Intel for Startups, “The excitement, as well as controversy, around anything LLM and generative AI was just enhanced. We are still early in the AI revolution, the importance of trusted and credible companies leading the way is high.”

How will this affect founders’ choice of tech?

As to whether the situation will affect founders’ choice of AI technology in their startup, the responses are split. Of the founders surveyed, 53% report that the current situation did not create uncertainty around using OpenAI tech in their startup, while 35% reported using OpenAI tech in the future has a greater degree of uncertainty.

With startups increasingly relying on generative AI tech for a wide range of internal and external use cases, including GenAI-based customer-facing features and GenAI-focused core products, the need for a reliable and stable technology provider is growing.

Yael Benjamin is the founder of Startup Snapshot, a data-sharing platform working to increase transparency in the venture ecosystem.

Illustration: Dom Guzman