Sam Altman Wasn’t Fired From Y Combinator, Founder Says—As OpenAI Chief Faces Criticism From Ex-Board Member

Topline

Sam Altman was not fired from storied startup incubator Y Combinator, but he was forced to choose between the firm and OpenAI, one of the accelerator’s four founders said on Thursday, dismissing speculation about Altman that has been buoyed by recent clashes with staff over priorities and his dramatic ouster from and return to the AI firm.

Key Facts

Founder Paul Graham said in a post on X, formerly Twitter, he’s “tired of hearing that YC fired Sam,” which he called “not true.”

Graham insisted Altman’s departure from the tech incubator, where he was a partner and led as president for years before leaving amid a series of shake-ups in 2019, was amicable.

In November, the Washington Post, citing three people familiar with the incident, reported Altman had been booted from YC by none other than Graham himself over concerns the OpenAI founder was putting his own interests ahead of the company’s, and this week former OpenAI board member Helen Toner repeated the claims and said it was “hushed up at the time.”

Graham repeatedly emphasized Wednesday that YC did not fire Altman, but did tell him he needed to decide between running YC and OpenAI, which at the time had just announced a for-profit subsidiary to be headed by Altman as CEO.

“We didn’t want him to leave, just to choose one or the other,” Graham said, adding it was Jessica — presumably fellow YC founder Jessica Livingston — who presented Altman with the choice.

Altman agreed, Graham said, adding that the group would have equally accepted an outcome where Altman found someone else to head OpenAI so “he could focus 100% on YC.”

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News Peg

As Graham did not specify where he had been hearing Altman was fired from YC, it is tough to pinpoint exactly what prompted his posts, but a reasonable guess is the testimony of Toner this week. Toner was one of the people responsible for briefly ousting Altman from OpenAI last year, and she gave her first detailed account of what happened in an interview on the Ted AI Show podcast. Toner painted Altman as an untrustworthy figure and manipulative leader who “would pull out all the stops” to stop the board from firing him. Toner’s claims included Altman failing to tell the board he legally owned the OpenAI Startup Fund, lying to the board, giving inaccurate information on safety processes multiple times, and not informing them when ChatGPT launched in late 2022. “I guess the last thing I would say about this is that this actually isn’t a new problem for Sam,” Toner said, pointing to “reporting” suggesting he was “actually fired from his previous job at Y Combinator,” which she claimed “was hushed up at the time.” Toner also claimed the management team at Loopt, Altman’s “only other job in Silicon Valley,” twice tried to fire him “for what they called deceptive and chaotic behavior.” OpenAI board chair Bret Taylor dismissed and rejected Toner’s claims, the Verge reported, and said an independent review by a law firm found the board’s decision to oust Altman last November was not based on concerns regarding product safety or security, pace of development or OpenAI’s finances. OpenAI did not not immediately respond to Forbes’ request for comment.

What We Don’t Know

While Graham dismissed the idea Altman was fired from YC — and emphasized the difference between ousting someone and making them choose whether to commit fully or else leave — his comments did not speak to allegations raised in the Post article that Altman prioritized his own interests over those of the company. Similar concerns have reportedly and repeatedly been raised over Altman’s allegedly self-serving conduct at OpenAI in recent weeks and months, particularly regarding his sudden exit as CEO and his dramatic return days later and culture clashes with key employees over whether the company is prioritizing profit over safety.

Key Background

Y Combinator is arguably the most prestigious startup accelerator in the world and one of the most powerful forces in tech. Among the large stable of companies it has supported over the years, it can boast the likes of Airbnb, Coinbase, Dropbox, DoorDash, Ginkgo Bioworks, Instacart, Reddit and Stripe. Social media giant Reddit was among eight companies in the accelerator’s first “batch” taken on back in 2005. Loopt, a social mapping venture cofounded by Altman, was also part of YC’s original batch and Graham said he started trying to recruit him to head the firm as soon as he “became available in 2012.”

Forbes Valuation

Altman has an estimated net worth of $1 billion. He does not have equity in OpenAI and owes his fortune to a series of lucrative investments, including stakes in fintech darling Stripe, Reddit and nuclear fusion venture Helion. As well as his roles at Y Combinator and OpenAI, Altman also founded social mapping company Loopt.