OpenAI CFO Sarah Friar stated in a recent interview that Sam Altman’s AI startup desires government support in building AI capacity. The executive claims that the U.S. government should provide a “backstop” loan guarantee for its financing deals. After her comments went viral on social media, Friar walked them back.
In a recent interview with the Wall Street Journal, Sarah Friar, CFO of Sam Altman’s OpenAI, suggested that the company was seeking a government “backstop” or guarantee for its financing arrangements to support its infrastructure commitments. This immediately set off social media commenters, who accused OpenAI of being a major component of the AI bubble.
Breitbart News reported this week that Michael Burry of The Big Short is targeting companies like Nvidia and Palantir for being components of an AI bubble:
Bloomberg reports that in a series of 13F regulatory filings released on Monday, Michael Burry’s Scion Asset Management revealed that it had bought put options on Nvidia and Palantir, indicating a bearish stance on the two companies. The disclosures came just days after Burry posted a cryptic warning to retail investors about market exuberance on social media, including an image of his character from The Big Short movie and a warning that “sometimes, we see bubbles.”
The backlash to the interview was fast and furious:
Friar has since walked back those comments, stating that her intention was not to seek direct government financial support for OpenAI, but rather to emphasize the importance of the U.S. government playing a role in maintaining the country’s industrial AI capacity.
Friar clarified her stance in a LinkedIn post, stating, “OpenAI is not seeking a government backstop for our infrastructure commitments. I used the word ‘backstop,’ and it muddied the point. As the full clip of my answer shows, I was making the point that American strength in technology will come from building real industrial capacity, which requires the private sector and government playing their part.”
During the original interview with WSJ‘s Sarah Krouse, Friar discussed OpenAI’s goal of maintaining its technological lead in both AI models and hardware used for training and inference. She mentioned that this requires significant investment, often in the form of purchasing the latest chips before competitors. When asked about financing these deals and investments, Friar initially suggested that OpenAI would benefit from a government guarantee of its loans, referring to an “ecosystem” of banks, private equity, and potentially government support.
However, in her clarifying statement, Friar praised the U.S. government for being “incredibly forward-leaning” and understanding the strategic importance of AI. She emphasized that her comments were intended to highlight the need for collaboration between the private sector and government in maintaining the country’s competitive edge in AI technology, rather than a direct request for financial backing.
Breitbart News reported this week that Sam Altman threw a hissy fit at an OpenAI supporter who gave him the opportunity to defend the company’s massive spending compared to its relatively modest revenues:
When Gerstner directly asked Altman to explain how a company with $13 billion in revenue could justify $1.4 trillion in spending commitments, a visibly annoyed Altman retorted, “If you want to sell your shares, I’ll find you a buyer. Enough.” He went on to assert that there were plenty of people who would eagerly buy shares from any concerned investors. The question, from an OpenAI shareholder and supporter, was obviously designed to tee up Altman to make his case on the strength of OpenAI’s business.
Read more at the Wall Street Journal here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
