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Exclusive Interview: OpenAI’s Sam Altman Talks ChatGPT And How Artificial General Intelligence Can ‘Break Capitalism’

In a rare interview, OpenAI’s CEO talks about AI model ChatGPT, artificial general intelligence and Google Search.

By Alex Konrad and Kenrick Cai

As CEO of OpenAI, Sam Altman captains the buzziest — and most scrutinized — startup in the fast-growing generative AI category, the subject of a recent feature story in the February issue of Forbes.

After visiting OpenAI’s San Francisco offices in mid-January, Forbes spoke to the recently press-shy investor and entrepreneur about ChatGPT, artificial general intelligence and whether his AI tools pose a threat to Google Search.

This interview has been edited for clarity and consistency

ALEX KONRAD: It feels to me like we are at an inflection point with the popularity of ChatGPT, the push to monetize it and all this excitement around the partnership with Microsoft. From your standpoint, where does OpenAI feel like it is in its journey? And how would you describe the inflection point?

SAM ALTMAN: It's definitely an exciting time. But my hope is that it's still extremely early. Really this is going to be a continual exponential path of improvement of the technology and the positive impact it has on society. We could have said the same thing at the GPT-3 launch or at the DALL-E launch. We're saying it now [with ChatGPT]. I think we could say it again later. Now, we may be wrong, we may well hit a stumbling block we haven't or don't expect. But I think there's a real chance that we actually have figured out something significant here and this paradigm will take us very, very far.

Were you surprised by the response to ChatGPT?

I wanted to do it because I thought it was going to work. So, I'm surprised somewhat by the magnitude. But I was hoping and expecting people were going to really love it.

[OpenAI President] Greg Brockman told me that the team wasn't even sure it was worth launching. So not everyone felt that way.

There's a long history of the team not being as excited about trying to ship things. And we just say, “Let's just try it. Let's just try it and see what happens.” This one, I pushed hard for this one. I really thought it was gonna work.

You've said in the past you think people might be surprised about how really ChatGPT came together or is run. What would you say is misunderstood?

So, one of the things is that the base model for ChatGPT had been in the API for a long time, you know, like 10 months, or whatever. [Editor’s note: ChatGPT is an updated version of model GPT-3, first released as an API in 2020.] And I think one of the surprising things is, if you do a little bit of fine tuning to get [the model] to be helpful in a particular way, and figure out the right interaction paradigm, then you can get this. It's not actually fundamentally new technology that made this have a moment. It was these other things. And I think that is not well understood. Like, a lot of people still just don't believe us, and they assume this must be GPT-4.

With the froth in the entire AI ecosystem, is that a rising tide that is helpful for you? Or does it create noise that makes your job more complicated?

Both. Definitely both.

Do you think that there is a real ecosystem forming here, where companies besides OpenAI are doing important work?

Yeah, I think this is way too big for one company. And actually, I am hopeful that there is a real ecosystem here. I think that's much better. I think there should be multiple AGIs [artificial general intelligences] in the world at some point. So I really welcome that.

Do you see any parallels between where the AI market is today and, say, the emergence of cloud computing, search engines or other technologies?

Look, I think there are always parallels. And then there are always things that are a little bit idiosyncratic. And the mistake that most people make is to talk way too much about the similarities, and not about the very subtle nuances that make them different. And so it's super easy and understandable to talk about OpenAI as like, “Ah, yes, this is going to be just like the cloud computing battles. And there's going to be several of these platforms, and you'll just use one as an API.” But there are a bunch of things about it that are also super different, and there are going to be very different feature choices that people make. The clouds are quite different in some ways, but you put something up, and it gets served. I think there will be much more of a spread between the various AI offerings.

People are wondering if ChatGPT replaces the traditional search engine, like Google Search. Is that something that motivates or excites you?

I mean, I don't think ChatGPT does [replace Search]. But I think someday, an AI system could. More than that, though, I think people are just totally missing the opportunity if you're focused on yesterday's news. I'm much more interested in thinking about what comes way beyond search. I don't remember what we did before web search, I’m sort of too young. I assume you are, too…

We had an Encyclopedia Britannica CD-ROM when I was a little kid.

Yeah, okay, exactly. There we go. I remember that, actually, exactly that. But, no one came along and said, “Oh, I'm going to make a slightly better version of the Encyclopedia Britannica on the CD-ROM at my elementary school.” They're like, “Hey, actually we can just do this in a super different way.” And the stuff that I'm excited about for these models is that it's not like, “Oh, how do you replace the experience of going on the web and typing in a search query,” but, “What do we do that is totally different and way cooler?’”

And that's something unlocked by AGI? Or does that happen before that?

Oh, no, I hope it happens very soon.

Do you feel that we are close to the goal of something like an AGI? And how would we know when that version of GPT, or whatever it is, is getting there?

I don't think we're super close to an AGI. But the question of how we would know is something I've been reflecting on a great deal recently. The one update I've had over the last five years, or however long I've been doing this — longer than that — is that it's not going to be such a crystal clear moment. It's going to be a much more gradual transition. It'll be what people call a “slow takeoff.” And no one is going to agree on what the moment was when we had the AGI.

Do you see that being relevant to all of your interests beyond OpenAI? Do they all fit into an AGI theory, Worldcoin and these other companies?

Yeah, it is. That is, at least, the framework in which I think. [AGI] is the thrust that drives all my actions. Some are more direct than others, but many that don't seem direct, still are. And then there is also the goal of getting to a world of abundance. I think energy is really important, for example, but energy is also really important to create AGI.

Greg [Brockman] has said that while OpenAI is research driven, it's not anti-capitalist. How are you navigating the wire act between being for-profit with investors who want a return and the broader goal of OpenAI?

I think capitalism is awesome. I love capitalism. Of all of the bad systems the world has, it's the best one — or the least bad one we found so far. I hope we find a way better one. And I think that if AGI really truly fully happens, I can imagine all these ways that it breaks capitalism.

We've tried to design a structure that is, as far as I know, unlike any other corporate structure out there, because we actually believe in what we're doing. If we just thought this was going to be another tech company, I'd say, “Great, I know this playbook because I’ve been doing it my whole career, so let's make a really big company.” But if we really, truly get AGI and it breaks, we'll need something different [in company structure]. So I'm very excited for our team and our investors to do super well, but I don't think any one company should own the AI universe out there. How the profits of AGI are shared, how access to is shared and how governance is distributed, those are three questions that are going to require new thinking.

Greg walked me through the idea of a third-party API future alongside first-party products —enterprise tools, perhaps. As you productize, how do you maintain an ethos of OpenAI staying open?

I think the most important way we do that is by putting out open tools like ChatGPT. Google does not put these things out for public use. Other research labs don't do it for other reasons; there are some people who fear it’s unsafe. But I really believe we need society to get a feel for this, to wrestle with it, to see the benefits, to understand the downsides. So I think the most important thing we do is to put these things out there so the world can start to understand what's coming. Of all the things I'm proud of OpenAI for, one of the biggest is that we have been able to push the Overton Window [Editor’s note: a model for understanding what policies are politically acceptable to the public at a given time] on AGI in a way that I think is healthy and important — even if it's sometimes uncomfortable.

Beyond that, we want to offer increasingly powerful APIs as we are able to make them safer. We will continue to open source things like we open-sourced CLIP [Editor’s note: a visual neural network released in 2021]. Open source in really what led to the image generation boom. More recently, we open sourced Whisper and Triton [automatic speech recognition and a programming language]. So I believe it's a multi-pronged strategy of getting stuff out into the world, while balancing the risks and benefits of each particular thing.

What would you say to people who might be concerned that you're hitching your wagon to [CEO] Satya [Nadella] and Microsoft?

I would say we have carefully constructed any deals we've done with them to make sure we can still fulfill our mission. And also, Satya and Microsoft are awesome. I think they are, by far, the tech company that is most aligned with our values. And every time we've gone to them and said, “Hey, we need to do this weird thing that you're probably going to hate, because it's very different than what a standard deal would do, like capping your return or having these safety override provisions,” they have said, “That's awesome.”

So you feel like the business pressures or realities of the for-profit side of OpenAI will not conflict with the overall mission of the company?

Not at all. You could reference me with anyone. I'm sort of well known for not putting up with anything I don't want to put up with. I wouldn't do a deal if I thought that.

You guys are not monks in hair shirts saying, “We don't want to make a profit off of this.” At the same time, it feels like you're not motivated by wealth creation, either.

I think it is a balance for sure. We want to make people very successful, making a great return [on their equity], that's great, as long as it's at a normal, reasonable level. If the full AGI thing breaks, we want something different for that paradigm. And we want the ability to bake in now how we're going to share this with society. I think we've done it in a nice way that balances it.

What has been the coolest thing you've seen someone do with GPT so far? And what's the thing that scares you most?

It's really hard to pick one coolest thing. It has been remarkable to see the diversity of things people have done. I could tell you the things that I have found the most personal utility in. Summarization has been absolutely huge for me, much more than I thought it would be. The fact that I can just have full articles or long email threads summarized has been way more useful than I would have thought. Also, the ability to ask esoteric programming questions or help debug code in a way that feels like I've got a super brilliant programmer that I can talk to.

As far as a scary thing? I definitely have been watching with great concern the revenge porn generation that’s been happening with the open source image generators. I think that's causing huge and predictable harm.

Do you think the companies who are behind these tools have a responsibility to ensure that kind of thing doesn't happen? Or is this just an unavoidable side of human nature?

I think it's both. There's this question of like, where do you want to regulate it? In some sense, it'd be great if we could just point to those companies and say, “Hey, you can't do these things.” But I think people are going to open source models regardless, and it's mostly going to be great, but there will be some bad things that happen. Companies that are building on top of them, companies that have the last relationship with the end user, are going to have to have some responsibility, too. And so, I think it's going to be joint responsibility and accountability there.



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    header-4x5-scott-dunn-by-michael-Thad-carter-for-forbes
    Manufacturing
    Daily Cover

    Meet The Texas Startup That Recycles Rare-Earth Magnets, Bypassing China

    Scott Dunn, Noveon Magnetics' chief executive officer Michael Thad Carter for Forbes
    Amy Feldman
    Forbes Staff

    As demand rises and reliance on China becomes an issue of economic security, Noveon offers a solution.

    At a factory in San Marcos, Texas, workers gather Bird scooters, computer hard drives, MRI machines and motors from hybrid cars in order to separate out the old rare-earth magnets so they can be ground down and shaped into new ones. These strong permanent magnets are everywhere, even if most people know nothing about them. They go into everything from electric vehicles to wind turbines to consumer electronics to missile guidance systems. Yet for years, the U.S. has been largely dependent on China for rare-earth processing. Noveon Magnetics, the startup behind this recycling effort, has a grand plan — and some patented technology — to make a dent in that dependance.

    “We didn’t realize till the last decade how big the potential shortfalls were,” says Scott Dunn, Noveon’s cofounder and chief executive. “You don’t just get to turn on the spigot and produce these. They’re not a commodity.”

    Magnets go into motors and generators that enable electricity to be transformed into motion and motion into electricity. Permanent magnets, made with rare earth materials, are a key element of the country’s efforts to decarbonize with electric vehicles and wind turbines. Because of their higher performance — allowing smaller, more powerful motors than alternatives — their use has spread and continues to rise. Global demand for rare-earth magnets will increase at 7.5% compounded annually through 2040, according to Adamas Intelligence.

    Noveon, founded nearly a decade ago and currently expecting just $10 million in revenue this year, is a drop in the bucket for now. As with any precision manufacturing process, it has to run customers’ magnets through a battery of tests to qualify their use before scaling up. But with $150 million in equity funding — including a new $75 million investment led by energy investor NGP that has not been previously reported — at a valuation of approximately $300 million, it has set up its factory and is ready to crank up its output.

    “We would need to build four or five factories to meet the demand of our customers.”

    Scott Dunn, Noveon cofounder and CEO

    Dunn figures that once its San Marcos facility is at capacity, by 2024 or 2025, it will be able to churn out 2,000 tons of magnets under long-term supplier agreements, using a mix of recycled and mined rare-earth materials, and bringing in revenue of $250 million with 40% Ebitda at current magnet prices. After that, he hopes to set up similar magnet factories in Europe and Asia (outside of China), with a goal of reaching $1 billion in revenue within five years.

    Scaling up an operation like this is extremely capital-intensive. Rare-earth prices have been volatile long term. And a key ingredient will be keeping the supply chains for the recycled materials running smoothly. But Dunn says that demand is so high that Noveon can’t even begin to meet its existing customers’ needs from its San Marcos factory. “We would have to build four or five factories to meet the demand of our customers,” he says.

    Noveon isn’t the only company building a magnet factory in the U.S. to meet demand for domestically manufactured magnets as an alternative to China. MP Materials, a publicly traded $4 billion (market cap) firm that owns a major rare-earth mining and processing facility at Mountain Pass, California is currently building a magnet factory in Fort Worth, Texas with a capacity of 1,000 tons of finished magnets and a long-term agreement to supply General Motors. Two other U.S.-headquartered firms, Quadrant Magnetics and USA Rare Earth, as well as the German company Vacuumschmelze, have plans to establish U.S. magnet manufacturing facilities by 2026.

    “If we can develop new processing, that is the key leverage point in getting our critical minerals supply re- or near-shored efficiently,” says Aidan Madigan-Curtis, a partner at the venture firm Eclipse, which has no relationship to Noveon.

    For Noveon, it hasn’t been easy. Dunn and cofounders Peter Afiuny, Miha Zakotnik and Catalina Oana Tudor have spent years refining and patenting the technology and figuring out how to scale it up, helped by funding from the Department of Defense as well as money from private investors.

    Typically, recycling permanent magnets results in decreased performance, but Dunn says that’s not the case with Noveon’s proprietary technology. Early customers include Nidec Motor, a large manufacturer of motors that’s part of Japan’s publicly traded ($30 billion market cap) Nidec Corp., and Eriez, a privately held manufacturer of industrial equipment — plus a number of customers that Dunn declines to name on the record.

    Getting rare earth magnets, after all, is a big issue for the companies that need them, and with China reportedly considering prohibiting exports of certain rare-earth magnet technology following Washington’s restrictions on semiconductors, having homegrown supply is a big competitive advantage. “Permanent magnets are to motors what lithium is to batteries,” says Kirk Anderson, Nidec Motor’s director of government affairs. “These magnets, and critical minerals in general, are key to achieving the decarbonization goals the Administration is talking about.”

    In 2021, the Commerce Department initiated an investigation into the effects on national security from imports of rare-earth magnets. The resulting report, released in February, concluded that the present quantities and circumstances of magnet imports “threaten to impair the national security,” and recommended bolstering U.S. magnet supply with a tax credit for domestic manufacturing and continued investment through the Defense Production Act, among other things. In April, Representatives Guy Reschenthaler (R-Pa.) and Eric Swalwell (D-Calif.) introduced a bipartisan bill to support domestic rare-earth magnet manufacturing with tax credits.

    With critical minerals a major political issue, Texas Gov. Greg Abbott chose Noveon’s factory as the site of his State of the State address in February. Calling Noveon “a cutting-edge business in the critical field of rare earth elements,” Abbott said that we needed to decrease our reliance on China for rare earth minerals. “If that supply is ever disrupted, many of the things we do every day would come to a halt,” he said.

    Dunn, 34, grew up in the town of Bel Air, Maryland, where his family had a privately held body armor and ballistics company. He studied at the U.S. Naval Academy, then transferred to the University of Southern California, where he studied environmental science.

    The Dunns’ family business was small, but it got interesting work, like testing the bulletproof glass for presidential vehicles. Dunn first learned about recycling there, when his dad asked him as a teenager to figure out what to do with some leftover aluminum alloy known as 6061. “I’d been scrapping metal since I was 12,” he says.

    After college, he continued on the recycling path, first at a Los Angeles firm that did energy retrofits and then, with cofounder Afiuny, a former colleague, on his own. Having learned just how much valuable metal could be recovered and recycled from old solar thermal water heating systems, their first effort focused on that niche. “We were selling direct to a copper smelter in the Philippines that was owned by a Japanese company,” Dunn says.

    “These magnets, and critical minerals in general, are key to achieving the decarbonization goals the Administration is talking about.”

    Kirk Anderson, Nidec Motor’s director of government affairs

    The business, at first called Urban Mining, morphed into Noveon after a professor of Dunn’s and a mentor of Afiuny’s nudged them to look at battery-related materials and rare earths. While the average consumer was oblivious to the importance of rare earth materials, the need for them to power electrification was becoming known in certain circles with the popularity of the hybrid Prius and the introduction of the first Tesla Roadster.

    Following a 2010 incident in waters controlled by Japan but claimed by China, the Chinese government restricted exports of rare earths. Prices soared for two key rare earths used in magnets, with neodymium rising 750% and dysprosium rocketing 2,000%. “Peter and I were already a little bit on the trail,” Dunn says. “As a selfish capitalist, you could say, those are opportunity areas you want major exposure to.”

    At first, Dunn and Afiuny, drawing on their recycling background, figured they’d simply try to consolidate rare-earth materials and sell it to separators in China and Japan. By 2012, the duo had traveled the globe — China, India, the Philippines, as well as the U.S. and Canada — looking at mines and separation facilities. “It was starting to become a bit of a buzz in defense circles in the U.S.,” Dunn says. “With hindsight, it seems like a no-brainer. But ten or 12 years ago, we had no idea what the issues could become like with China.”

    In 2012, with the business at a standstill, Dunn and Afiuny attended a permanent magnet conference in Nagasaki, where they met Zakotnik, now the company’s chief technology officer, and Tudor. Zakotnik told them about his process for recycling rare-earth magnets. “This guy at the time had a big ponytail, so I thought, ‘This guy is a crazy scientist and I don’t believe him.’ We changed our trip and I went to China, and Miha kind of blew us away,” Dunn says.

    Zakotnik, 47, who is from Slovenia and a chemist and materials scientist by training, had invented a process to recycle rare-earth permanent magnets through a powder metallurgy process. “As part of my Ph.D., I showed that our route could be used to recycle not once, but twice, three times, four times,” says Zakotnik, who published his research in 2008. Before joining forces with Dunn, he’d been a scientist at Yantai Shougang Magnetic Materials in China and a visiting professor at Beijing University of Technology researching rare-earth magnetic materials. But he’d always wanted to get his research into the real world.

    “I tried to formulate this company five times. I failed five times,” he says. The problem, he says, was that starting a magnet recycling factory requires enormous amounts of capital upfront, without having a history as a business. “There is a lot of controversy in recycling magnets, that something like this is possible,” he says.

    Returning to the U.S., Dunn and team started the business on the cheap in Delaware. Dunn’s father, who had sold the body armor and ballistics company to Intertek, was the first seed investor, putting in $1 million. They soon received their first government funds through the federal Small Business Innovation Research program, known as SBIR. In 2015, having received patents for their technology, they got an additional $25 million in equity and help with debt financing from the Kloiber family of Kentucky.

    That gave them the funds to relocate to Texas, and to set up a pilot plant in Austin. The recycling process would not only give them an edge, they believed, but also allow them to make a historically hazardous process more energy efficient and environmentally friendly. Making magnets is typically a dirty process, one reason why processing them had migrated to China, and disposing of them is tough because they’re considered contaminants. Noveon’s process solved both of these problems. And once the company harvested the rare-earth materials from the old products, it recycled the remaining metal for scrap.

    “Noveon makes the highest power or highest density magnets,” says Nidec’s Anderson. “They’re the best of the best.”

    Terri Koebe, director of global strategic sourcing at Erie, Pennsylvania-based Eriez, first learned about Noveon from an engineer who’d attended a magnetics conference in Orlando, Florida in 2019. Soon the industrial firm had tested Noveon’s magnets, found them satisfactory and signed on as a customer. “They were very high quality and we were really impressed,” Koebe says. “It’s very complicated to extrapolate the rare earths from scrap material.”

    Permanent magnets come in many varieties depending on their end use, and each one needs to be tested for months before it’s ready for mass production. It wasn’t long before word spread about Noveon’s American-made magnets.

    “The demand for our product started to explode,” Dunn says. “We had automotive companies calling us saying, ‘How much can you make and when?’”

    For a brief moment when tech stocks and SPAC deals were booming, Noveon was told it could be worth $1 billion. Today Dunn just laughs at that number. “I had to bust our banker’s chops a little bit,” he says. “I grew up in a family business. I’ve seen what happens when you pretend you have money on paper that’s not actually the value.”

    After all, there are still big issues to figure out, including getting enough material with old rare-earth magnets to turn into new ones. Dunn says that while today most everything Noveon produces is made with recycled magnets, as the factory scales up to 2,000 tons its goal is to be at least 50% recycled material.

    A bigger question long-term is whether viable alternatives to rare earths can be found. In March, Tesla announced that its next generation of electric vehicles would contain no rare-earth materials. While researchers at Adamas estimate that Tesla’s move would decrease global demand by just 2% to 3% in the near term, it has focused attention on the potential for alternatives that could lower costs and avoid supply-chain constraints.

    For now, the supply-demand imbalance is so great that Noveon’s focus is scaling up its factory to give customers an alternative supply of American-made magnets. As Dunn says: “We don’t want China to just deliver us our quality of living and not have control of our destiny.”


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    Amy Feldman
    Amy Feldman

    I'm a senior editor at Forbes, where I cover manufacturing, industrial innovation and consumer products. I also edit the Next Billion-Dollar Startups list. Before rejoining Forbes in 2016,

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