Trust and transformational tech

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The web’s been abuzz all weekend. On Friday night news broke that the Open AI board fired Sam Altman from his CEO role with the board chairman Greg Brockman stepping down.

Regular readers probably expect a commentary on the governance red flags visible here. I may write about it at some point but for now a more important consideration especially if you are a Chairman or a CEO of an enterprise.

Generative AI burst on to broader public awareness with the launch of Chat GPT in 2022.

Enterprises rushed to work out guard rails and to deploy Generative AI in their businesses, for fear of losing their competitive edge as much as for containing risks such as leakage of proprietary data. Companies have invested in proprietary product strategies and tools, and in hiring and skilling.

While the pace of adoption has varied — it was just four days ago that Thomson Reuters, a company sitting on a wealth of data, announced “generative AI powered solutions to transform how legal professionals work” — the adoption has been relentless.

Per Accel, investors have pumped $18 billion into GenAI startups in the first ten months of 2023 quintupling 2022 investments, and a good two-thirds of the “unicorns” produced this year are “Gen AI native”.

In other words, never mind Microsoft’s $13 Bn investment into Open AI, for it is dwarfed by the scale of the known-so-far VC investment in Generative AI startups and the yet-unknown sums of money that enterprises have invested in Generative AI capabilities. To wit, a McKinsey estimate says in its first few months, Generative AI features may add $4.4 trillion to the global economy annually.

The speed at which transformative technologies take over our imaginations can vary but the speed at which Generative AI has been adopted in enterprises and startups has been swift by any metric.

The sudden firing of the very visible CEO of Open AI and the stepping down of the Chairman, after he was excluded from the decision-making process, raise a very important question about Trust and Transformational Technologies.

As I have written before: Trust is a licence, to be renewed or forfeited by every subsequent action taken by a party in whom we repose that trust.  

Open AI’s stakeholders the world over are currently bearing systemic risk — and crucially, uncertainty about their investments into Generative AI — at a massive scale while the situation is resolved.

The trust that has been dented may take a longer while to recover.

(Disclaimer: These are my own views and do not reflect the views of the boards of JP Morgan US Smaller Co.s Investment Trust or Temple Bar Investment Trust or Harmony Energy Income Trust, or Witan, or the Royal Academy of Engineering, where I serve as a non-exec director, and chair or serve on various committees at the time of writing.

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