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OpenAI is a nonprofit-corporate hybrid: A management expert explains how this model works − and how it fueled the tumult around CEO Sam Altman’s short-lived ouster

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OpenAI is a nonprofit-corporate hybrid: A management expert explains how this model works − and how it fueled the tumult around CEO Sam Altman's short-lived ouster

OpenAI Sam Altman had a tumultuous November.
omohiro Ohsumi/Getty Images

Alnoor Ebrahim, Tufts University

The board of OpenAI, creator of the popular ChatGPT and DALL-E artificial intelligence tools, fired Sam Altman, its chief executive officer, in late November 2023.

Chaos ensued as investors and employees rebelled. By the time the mayhem had subsided five days later, Altman had returned triumphantly to the OpenAI fold amid staff euphoria, and three of the board members who had sought his ouster had resigned.

The structure of the board – a nonprofit board of directors overseeing a for-profit subsidiary – seems to have played a role in the drama.

As a management scholar who researches organizational accountability, governance and performance, I'd like to explain how this hybrid approach is supposed to work.

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Hybrid governance

Altman co-founded OpenAI in 2015 as a tax-exempt nonprofit with a mission “to build artificial general intelligence (AGI) that is safe and all of humanity.” To raise more capital than it could amass through charitable donations, OpenAI later established a holding company that enables it to take money from investors for a for-profit subsidiary it created.

OpenAI's chose this “hybrid governance” structure to enable it to stay true to its social mission while harnessing the power of markets to grow its operations and revenues. Merging profit with purpose has enabled OpenAI to raise billions from investors seeking financial returns while balancing “commerciality with safety and sustainability, rather than focusing on pure profit-maximization,” according to an explanation on its website.

Major investors thus have a large stake in the of its operations. That's especially true for Microsoft, which owns 49% of OpenAI's for-profit subsidiary after investing US$13 billion in the company. But those investors aren't entitled to board seats as they would be in typical corporations.

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And the profits OpenAI returns to its investors are capped at approximately 100 times what the initial investors put in. This structure calls for it to revert to a nonprofit once that point is reached. At least in principle, this design was intended to prevent the company from veering from its purpose of benefiting humanity safely and to avoid compromising its mission by recklessly pursuing profits.

Other hybrid governance models

There are more hybrid governance models than you might think.

For example, the Philadelphia Inquirer, a for-profit newspaper, is owned by the Lenfest Institute, a nonprofit. The structure allows the newspaper to attract investments without compromising on its purpose – journalism serving the needs of its local communities.

Patagonia, a designer and purveyor of outdoor clothing and gear, is another prominent example. Its founder, Yvon Chouinard, and his heirs have permanently transferred their ownership to a nonprofit trust. All of Patagonia's profits now fund environmental causes.

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Anthropic, one of OpenAI's competitors, also has a hybrid governance structure, but it's set up differently than OpenAI's. It has two distinct governing bodies: a corporate board and what it calls a long-term benefit trust. Because Anthropic is a public benefit corporation, its corporate board may consider the interests of other stakeholders besides its owners – the general public.

And BRAC, an international organization founded in Bangladesh in 1972 that's among the world's largest NGOs, controls several for-profit social enterprises that benefit the poor. BRAC's model resembles OpenAI's in that a nonprofit owns for-profit businesses.

Origin of the board's clash with Altman

The primary responsibility of the nonprofit board is to ensure that the mission of the organization it oversees is upheld. In hybrid governance models, the board has to ensure that market pressures to make money for investors and shareholders don't override the organization's mission – a risk known as mission drift.

Nonprofit boards have three primary duties: the duty of obedience, which obliges them to act in the interest of the organization's mission; the duty of care, which requires them to exercise due diligence in making decisions; and the duty of loyalty, which commits them to avoiding or addressing conflicts of interest.

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It appears that OpenAI's board sought to exercise the duty of obedience when it decided to sack Altman. The official reason given was that he was “not consistently candid in his communications” with its board. Additional rationales raised anonymously by people identified as “Concerned Former OpenAI Employees” have not been verified.

In addition, board member Helen Toner, who left the board amid this upheaval, co-authored a research paper just a month before the failed effort to depose Altman. Toner and her co-authors praised Anthropic's precautions and criticized OpenAI's “frantic corner-cutting” around the release of its popular ChatGPT chatbot.

Mission v. money

This wasn't the first attempt to oust Altman on the grounds that he was straying from mission.

In 2021, the organization's head of AI safety, Dario Amodei, unsuccessfully tried to persuade the board to oust Altman because of safety concerns, just after Microsoft invested $1 in the company. Amodei later left OpenAI, along with about a dozen other researchers, and founded Anthropic.

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The seesaw between mission and money is perhaps best embodied by Ilya Sutskever, an OpenAI co-founder, its chief scientist and one of the three board members who were forced out or stepped down.

Sutskever first defended the decision to oust Altman on the grounds that it was necessary for protecting the mission of making AI beneficial to humanity. But he later changed his mind, tweeting: “I deeply regret my participation in the board's actions.”

He eventually signed the employee letter calling for Altman's reinstatement and remains the company's chief scientist.

Man in blue button-down shirt gesticulates with one arm outstretched against a backdrop with the words TechCrunch and DISRUPT
Former OpenAI executive Dario Amodei co-founded Anthropic, another AI company with a nonprofit board. He now serves as its CEO.
Kimberly White/Getty Images for TechCrunch

AI risks

An equally important question is whether the board exercised its duty of care.

I believe it's reasonable for OpenAI's board to question whether the company released ChatGPT with sufficient guardrails in November 2022. Since then, large language models have wreaked havoc in many industries.

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I've seen this firsthand as a professor.

It has become nearly impossible in many cases to tell whether are cheating on assignments by using AI. Admittedly, this risk pales in comparison to AI's ability to do even worse things, such as by helping design pathogens of pandemic potential or create disinformation and deepfakes that undermine social trust and endanger democracy.

On the flip side, AI has the potential to huge benefits to humanity, such as speeding the development of lifesaving vaccines.

But the potential risks are catastrophic. And once this powerful technology is released, there is no known “off switch.”

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Conflicts of interest

The third duty, loyalty, depends on whether board members had any conflicts of interest.

Most obviously, did they stand to make money from OpenAI's products, such that they might compromise its mission in the expectation of financial gain? Typically the members of a nonprofit board are unpaid, and those who aren't working for the organization have no financial stake in it. CEOs to their boards, which have the authority to hire and fire them.

Until OpenAI's recent shake-up, however, three of its six board members were paid executives – the CEO, the chief scientist and the president of its profit-making arm.

I'm not surprised that while the three independent board members all voted to oust Altman, all of the paid executives ultimately backed him. Earning your paycheck from an entity you are supposed to oversee is considered a conflict of interest in the nonprofit world.

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I also believe that even if OpenAI's reconfigured board manages to fulfill the mission of serving the needs of society, rather than maximizing its profits, it would not be enough.

The tech industry is dominated by the likes of Microsoft, Meta and Alphabet – massive for-profit corporations, not mission-driven nonprofits. Given the stakes, I think regulation with teeth is required – leaving governance in the hands of AI's creators will not solve the problem.The Conversation

Alnoor Ebrahim, Professor of Management, Tufts University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Bacteria can develop resistance to drugs they haven’t encountered before − scientists figured this out decades ago in a classic experiment

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Bacteria can develop resistance to drugs they haven't encountered before − scientists figured this out decades ago in a classic experiment

Bacteria are evolutionarily primed to outpace drug developers.
National Institute of Allergy and Infectious Diseases, National Institutes of Health/Flickr, CC BY-NC

Qi Zheng, Texas A&M University

Do bacteria mutate randomly, or do they mutate for a purpose? Researchers have been puzzling over this conundrum for over a century.

In 1943, microbiologist Salvador Luria and physicist turned biologist Max Delbrück invented an experiment to argue that bacteria mutated aimlessly. Using their test, other scientists showed that bacteria could acquire resistance to antibiotics they hadn't encountered before.

The Luria–Delbrück experiment has had a significant effect on science. The findings helped Luria and Delbruck win the Nobel Prize in physiology or medicine in 1969, and learn this experiment in biology classrooms. I have been studying this experiment in my work as a biostatistician for over 20 years.


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Decades later, this experiment offers lessons still relevant today, because it implies that bacteria can develop resistance to antibiotics that haven't been developed yet.

Slot machines and a eureka moment

Imagine a test tube containing bacteria living in nutrient broth. The broth is cloudy due to the high concentration of bacteria within it. Adding a virus that infects bacteria, also known as a phage, into the tube kills most of the bacteria and makes the broth clear.

Illustration of bacteriophage structure.
Bacteriophages are viruses that specifically infect bacteria.
Kristina Dukart/iStock via Getty Images Plus

However, keeping the test tube under conditions favorable for bacterial growth will turn the broth cloudy again over time. This indicates that the bacteria developed resistance against the phages and were able to proliferate.

What role did the phages play in this change?

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Some scientists thought the phages incited the bacteria to mutate for survival. Others suggested that bacteria routinely mutate randomly, and the of phage-resistant variants was simply a lucky outcome. Luria and Delbrück had been working together for months to solve this conundrum, but none of their experiments had been successful.

On the night of Jan. 16, 1943, Luria got a hint about how to crack the mystery while watching a colleague hit the jackpot at a slot machine. The next morning, he hurried to his lab.

Luria's experiment consisted of a few tubes and dishes. Each tube contained nutrient broth that would the bacteria E. coli multiply, while each dish contained material coated with phages. A few bacteria were placed into each tube and given two opportunities to generate phage-resistant variants. They could either mutate in the tubes in the absence of phages, or they could mutate in the dishes in the presence of phages.

Illustration of six test tubes and and six petri dishes, a few of the dishes containing red dots
This diagram of the Luria-Delbrück experiment depicts colonies of phage-resistant variants of E. coli (red) developing in petri dishes.
Qi Zheng, CC BY-SA

The next day, Luria transferred the bacteria in each tube into a dish filled with phages. The day after that, he counted the number of resistant bacterial colonies in each dish.

If bacteria develop resistance against phages by interacting with them, none of the bacteria in the tubes should have mutations. On the other hand, only a few of the bacteria – say, 1 out of 10 million bacteria – should spawn resistant variants when they are transferred into a dish containing phages. Each phage-resistant variant would grow into a colony, but the remaining bacteria would die from infection.

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If bacteria develop resistance independently of interacting with phages, some of the bacteria in the tubes will have mutations. This is because each time a bacterium divides in a tube, it has a small probability of spawning a resistant variant. If the starting generation of bacteria is the first to mutate, at least half of the bacteria will be resistant in later generations. If a bacterium in the second generation is the first to mutate, at lest an eighth of the bacteria will be resistant in later generations.

Four tree diagrams of green and red circles, with subsequent branches from red dots turning red
Mutations that confer resistance against phages (red) early on will spawn a large number of phage-resistant variants, while mutations that occur later on will spawn only a few resistant variants.
Qi Zheng, CC BY-SA

Like small-prize cash-outs in slot machines, late-generation mutations occur more often but give fewer resistant variants. Like jackpots, early-generation mutations occur rarely but give large numbers of variants. Early-generation mutations are rare because early on there are only a small number of bacteria available to mutate.

For example, in a 20-generation experiment, a mutation occurring at the 10th generation of bacteria would give 1,024 phage-resistant variants. A mutation occurring at the 17th generation would give only four phage-resistant variants.

The number of resistant colonies in Luria's experiments showed a similar pattern to that of slot machine cash-outs. Most dishes contained no or small numbers of mutant colonies, but several contained a large number of mutant colonies that Luria considered jackpots. This meant that the bacteria developed resistant variants before they interacted with the phages in the dishes.

An experiment's legacy

Luria sent a note to Delbrück after his experiment was completed, asking him to check his work. The two scientists then worked together to write a classic paper describing the experimental protocol and a theoretical framework to measure bacterial mutation rates.

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Other scientists conducted similar experiments by replacing phages with penicillin and with tuberculosis drugs. Similarly, they found that bacteria did not need to encounter an antibiotic to acquire resistance to it.

Bacteria have relied on random mutations to cope with harsh, constantly changing environments for millions of years. Their incessant, random mutations will them to inevitably develop variants that are resistant to the antibiotics of the future.

Drug resistance is a reality of we will have to accept and continue to fight against.The Conversation

Qi Zheng, Professor of Biostatistics, Texas A&M University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Your heart changes in size and shape with exercise – this can lead to heart problems for some athletes and gym rats

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Your heart changes in size and shape with exercise – this can lead to heart problems for some athletes and gym rats

William Cornwell, University of Colorado Anschutz Medical Campus

Exercise has long been recognized by clinicians, scientists and public as an important way to maintain health throughout a person's lifespan. It improves overall , helps build strong muscles and bones, reduces the risk of chronic disease, improves mood and slows physical decline.

Exercise can also significantly reduce the risk of developing conditions that negatively affect heart heath, such as high blood pressure, high cholesterol and obesity. But large amounts of exercise throughout may also harm the heart, leading to the of a condition called athletic heart.

As the sports cardiology director at the University of Colorado Anschutz Medical Campus, I'm often asked how much and what kind of exercise is necessary to get the benefits of exercise. Many people also wonder about the risks of exercise, and what happens if you exercise too much.

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The American Heart Association generally recommends 150 minutes of moderate-intensity exercise, such as brisk walking, or 75 minutes of vigorous-intensity exercise, such as running, each week. It also recommends muscle strengthening exercises at least twice per week.

When people exceed these guidelines, the heart may remodel itself in response – that is, it begins to change its size and shape. As a result, heart function may also change. These changes in heart structure and function among people who engage in high levels of exercise are referred to as the athletic heart, or athlete's heart. Athletic heart doesn't necessarily cause problems, but in some people it can increase the risk of certain heart issues.

What is athletic heart?

To understand how exercise affects the heart, it's important to consider what kind of exercise you're participating in.

Exercise is generally divided into two broad categories: dynamic and static.

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Dynamic exercises, like running, cross-country skiing and soccer, require the heart to pump an increased amount of blood, compared to the amount delivered to the body at rest, in order to sustain the activity. For example, when running, the amount of blood the heart pumps to the body may increase by threefold to fivefold compared to at rest.

Static exercises, like weightlifting, gymnastics or rock climbing, require the body to use skeletal muscle in order to push or pull heavy amounts of weight. While the heart does pump more blood to skeletal muscles that are working during these activities, these kinds of exercises depend on a muscle's ability to move the weight. For example, in order to do curls with dumbbells, the biceps must be strong enough to lift the desired weight.

Close-up of lower half of the back of a person cycling, one hand outstretched towards the vegetation on the side of the road
Cycling involves both dynamic and static exercise.
Judit Murcia/Unsplash, CC BY-SA

Some exercises, like rowing or cycling, are both highly dynamic and highly static because they require the heart to pump large amounts of blood while simultaneously requiring a large amount of muscle strength to sustain effort.

It is important to distinguish between dynamic and static exercise because the heart adapts differently according to the type of exercise you engage in over time. Dynamic exercise increases the volume of blood pumping through the heart and can cause the heart to become enlarged, or dilated, over time. Static exercise increases the amount of pressure on the heart and can also cause it to become enlarged over time but with thickened walls.

Who develops athletic heart?

Exercise that exceeds guidelines, such as exercising more than an hour most days of the week, may to development of athletic heart. Athletic heart commonly occurs among endurance athletes, who regularly compete in activities like marathons or other long-duration events. Many exercise several hours per day and more than 12 to 15 hours per week.

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Among runners, for example, the heart remodels itself in response to to pump a high volume of blood. As a result, the chambers of the heart enlarge to hold and pump more blood. Among weightlifters, the heart remodels itself by thickening in response to the increase in pressure applied on the heart.

Exercise is good for the body, and athletic heart results from a lifelong commitment to an activity that promotes good health. But there may be some issues that arise from an athletic heart.

First, athletes with markedly enlarged hearts may be at risk of developing atrial fibrillation, which is abnormal heart rhythms that typically occur among older adults or people with high blood pressure or heart failure. Abnormal heart rhythms are worrisome because they may lead to a stroke.

There are many potential reasons atrial fibrillation occurs in athletes. A dilated atrium – the top chamber in the heart – may become inflamed and develop scar tissue, increasing the risk of atrial fibrillation. Stress and environmental factors may also work together to increase the risk of arrhythmia.

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Clip of an ultrasound reading of an enlarged heart beating
This is an echocardiogram of a 30-year-old athlete with an enlarged heart.
Runandbike/Wikimedia Commons, CC BY-SA

Coronary artery calcification, or CAC, is another concern among elite athletes. Coronary artery calcification, which commonly occurs in older adults or those with risk factors for coronary artery disease, increases the risk of having a heart attack or stroke. In recent years, doctors have been using imaging tests to monitor calcium buildup in the arteries of their to try to determine their risk of heart attack or stroke over time.

It is not entirely clear why elite athletes develop coronary artery calcification. Fortunately, it does not appear that athletes have an increased risk of heart attack, even among those with very high levels of CAC. For example, a large study of almost 22,000 participants found that even athletes who engaged in high amounts of exercise and had elevated levels of CAC did not have an increased risk of death from cardiovascular disease over a decade of follow-up.

Some athletes are appropriately concerned about having calcium buildup in their heart arteries and may wonder whether or not they should be taking medications like aspirin or statins. But risks vary from person to person, so anyone concerned about CAC should to their doctor

Putting exercise in its place

Though elite athletes may have an increased risk of developing athletic heart, exercise undoubtedly remains one of, if not the best, methods to maintain a healthy lifestyle.

For example, if someone does not exercise routinely, their heart will become stiff and not pump blood as well as it once did. Routine exercise – especially dynamic exercise like running – maintains a compliant heart and prevents stiffening. A compliant heart will expand a lot more as it fills with blood and, in turn, pump out more blood with each heartbeat. A stiff heart has difficulty filling up with blood and has difficulty pumping blood through the body.

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Two people running on a road lined with trees -- the younger person is trailing behind the older person who has leaped into the air with arms raised
Regular exercise can help keep your heart young.
Viacheslav Peretiatko/iStock via Getty Images Plus

Generally, routine exercise throughout adulthood encourages the heart to remain strong and flexible even in old age. Even if someone were only to begin regularly exercising in their 40s to 50s, it is possible to reverse some of the effects of sedentary aging.

For example, a 2018 study of 53 sedentary people mostly in their early 50s found that those who participated in a two-year exercise program using a combination of running, cycling and elliptical exercise had hearts that became more compliant compared to the hearts of those who did not exercise.

It is never too late to start exercising. Routinely following exercise guidelines can help promote physical and mental health and help your heart stay young throughout your life.The Conversation

William Cornwell, Associate Professor of Cardiology, University of Colorado Anschutz Medical Campus

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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I’ve been studying astronaut psychology since Apollo − a long voyage to Mars in a confined space could raise stress levels and make the journey more challenging

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I've been studying astronaut psychology since Apollo − a long voyage to Mars in a confined space could raise stress levels and make the journey more challenging

Crew members in space will spend lots of time together during future missions to Mars.
NASA via AP

Nick Kanas, University of California, San Francisco

Within the next few decades, NASA aims to humans on the Moon, set up a lunar colony and use the lessons learned to send people to Mars as part of its Artemis program.

While researchers know that space travel can stress space crew members both physically and mentally and test their ability to work together in close quarters, missions to Mars will amplify these challenges. Mars is far away – millions of miles from Earth – and a mission to the red planet will take two to two and a half years, between travel time and the Mars surface exploration itself.

As a psychiatrist who has studied space crew member interactions in orbit, I'm interested in the stressors that will occur during a Mars mission and how to mitigate them for the benefit of future space travelers.

Delayed communications

Given the great distance to Mars, two-way communication between crew members and Earth will take about 25 minutes round . This delayed contact with home won't just hurt crew member morale. It will likely mean space crews won't get as much real-time from Mission Control during onboard emergencies.

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Because these communications travel at the speed of light and can't go any faster, experts are coming up with ways to improve communication efficiency under time-delayed conditions. These solutions might include texting, periodically summarizing topics and encouraging participants to ask questions at the end of each message, which the responder can answer during the next message.

Autonomous conditions

Space crew members won't be able to communicate with Mission Control in real time to plan their schedules and activities, so they'll need to conduct their work more autonomously than astronauts working on orbit on the International Space Station.

Although studies during space simulations on Earth have suggested that crew members can still accomplish mission goals under highly autonomous conditions, researchers need to learn more about how these conditions affect crew member interactions and their relationship with Mission Control.

For example, Mission Control personnel usually advise crew members on how to deal with problems or emergencies in real time. That won't be an option during a Mars mission.

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To study this back on Earth, scientists could a series of simulations where crew members have varying degrees of contact with Mission Control. They could then see what happens to the interactions between crew members and their ability to get along and conduct their duties productively.

Simulations, like the Mars500 mission, could help researchers learn about the effects of isolation and autonomy astronauts will deal with during a Mars mission.

Crew member tension

Being confined with a small group of people for a long period of time can to tension and interpersonal strife.

In my research team's studies of on-orbit crews, we found that when experiencing interpersonal stress in space, crew members might displace this tension by blaming Mission Control for scheduling problems or not offering enough support. This can lead to crew-ground misunderstandings and hurt feelings.

One way to deal with interpersonal tension on board would be to schedule time each for the crew members to discuss interpersonal conflicts during planned “bull sessions.” We have found that commanders who are supportive can improve crew cohesion. A supportive commander, or someone trained in anger management, could facilitate these sessions to help crew members understand their interpersonal conflicts before their feelings fester and harm the mission.

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Time away from home

Spending long periods of time away from home can weigh on crew members' morale in space. Astronauts miss their families and being concerned about the well-being of their members back on Earth, especially when someone is sick or in a crisis.

Mission duration can also affect astronauts. A Mars mission will have three phases: the outbound trip, the stay on the Martian surface and the return home. Each of these phases may affect crew members differently. For example, the excitement of being on Mars might boost morale, while boredom during the return may sink it.

The disappearing-Earth phenomenon

For astronauts in orbit, seeing the Earth from space serves as a reminder that their home, family and friends aren't too far away. But for crew members traveling to Mars, watching as the Earth shrinks to an insignificant dot in the heavens could result in a profound sense of isolation and homesickness.

Earth, shown from space, against a dark background.
Seeing Earth disappear could make crew members feel isolated.
AP Photo

Having telescopes on board that will allow the crew members to see Earth as a beautiful ball in space, or giving them access to virtual reality images of trees, lakes and family members, could help mitigate any disappearing-Earth effects. But these countermeasures could just as easily lead to deeper depression as the crew members reflect on what they're missing.

Planning for a Mars mission

Researchers studied some of these issues during the Mars500 program, a collaboration between the Russian and other space agencies. During Mars500, six were isolated for 520 days in a space simulator in Moscow. They underwent periods of delayed communication and autonomy, and they simulated a landing on Mars.

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Scientists learned a lot from that simulation. But many features of a real Mars mission, such as microgravity, and some dangers of space – meteoroid impacts, the disappearing-Earth phenomenon – aren't easy to simulate.

Planned missions under the Artemis program will allow researchers to learn more about the pressures astronauts will face during the journey to Mars.

For example, NASA is planning a space station called Gateway, which will orbit the Moon and serve as a relay station for lunar landings and a mission to Mars. Researchers could simulate the outbound and return phases of a Mars mission by sending astronauts to Gateway for six-month periods, where they could introduce Mars-like delayed communication, autonomy and views of a receding Earth.

NASA's planned Gateway space station will orbit the Moon.

Researchers could simulate a Mars exploration on the Moon by having astronauts conduct tasks similar to those anticipated for Mars. This way, crew members could better prepare for the psychological and interpersonal pressures that come with a real Mars mission. These simulations could improve the chances of a successful mission and contribute to astronaut well-being as they venture into space.The Conversation

Nick Kanas, Professor Emeritus of Psychiatry, University of California, San Francisco

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This article is republished from The Conversation under a Creative Commons license. Read the original article.

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