AI: OpenAI's 'CEO of Applications'. RTZ #716
The Bigger Picture, Sunday, May 11, 2025
The founder/CEO of OpenAI, the leading LLM AI company has brought a seasoned external executive as ‘CEO of Applications’. That’s as clear as it could be that OpenAI sees its core future in Box 6 ot my long discussed AI Tech Wave tech stack chart below.
A clear leap from the middle of the stack at Box 3 to encompass Boxes 4,,5 and 6. This is a noteworthy move that will likely be emulated by peers, and worth discussing as Sunday’s ‘Bigger Picture’.
First, the basics of the new appointment. Bloomberg lays it out well in “OpenAI’s Simo Tasked With Keeping ChatGPT Ahead of Bot Rivals”:
“Simo will oversee executives and seek to broaden the company’s hit chatbot into a Swiss Army knife of artificial intelligence software.”
“With her new leadership role at OpenAI, Fidji Simo will be expected to bring to bear everything she’s learned about building customer loyalty — and navigating internal drama.”
She has quite the resume:
“Those who know Simo, 39, credit her intense ambition, political savvy and consumer instincts for her success in the industry. Simo climbed the ranks at Meta Platforms Inc. until she ran Facebook. Later, as chief executive officer of Instacart, she transformed the grocery delivery business from a money-losing startup to a growing, profitable public company.”
“As OpenAI’s CEO of applications, she will have several executives reporting to her who previously reported to CEO Sam Altman, potentially causing tension if the added management layer feels like a demotion for them. Altman will remain in charge, but shift his focus to overall strategy, the company said Wednesday.”
Along with AI Research, Compute and Safety, which also fall in founder/CEO Sam Altman’s core focus areas. All on the way to AGI:
”Simo will be tasked with broadening OpenAI’s hit chatbot, ChatGPT, into a Swiss Army knife of artificial intelligence software that keeps users from switching to rivals, such as those offered by Anthropic, Google, and Elon Musk’s xAI. In the fiercely competitive world of large language models, makers of chatbots are constantly trying to one-up each other with more powerful software. And she will have to do it all amid a straining relationship with key investor Microsoft Corp., a longstanding battle with OpenAI co-founder Elon Musk, and an extremely costly global data center expansion that depends on political support.”
“If things are already going well, it’s going to be an acceleration. If things need to be fixed, she’ll fix it,” said Vijaye Raji, founder and CEO of Statsig, who worked with Simo for years as former vice president and head of entertainment at Facebook. “She won’t be mincing. She will act, and she acts decisively.”
And she has already deep familiarity with the company’s directions by having been on the non-profit board. And the AI Scaling imperatives ahead.
“At OpenAI, as with Instacart, Simo had a board seat and learned about the business before jumping in to the leadership ranks. “Fidji is one of the most remarkable leaders I have ever had the privilege of working with, and I have personally seen her commitment to our mission in the boardroom over the past year,” Bret Taylor, OpenAI’s chairman, said in a post on social network X late Wednesday night.”
And the Org chart is a bit reorganized.
“Her ascent came with full-throated endorsements from her new direct reports on social media, but they may not all be happy about being a degree further removed from the top. Chief Operating Officer Brad Lightcap has reported directly to Altman for years, while Chief Product Officer Kevin Weil and Chief Financial Officer Sarah Friar were hired to be part of the top-level leadership team.”
“Simo will have to smooth any dissent to focus on supporting the trajectory of the company, which is chasing a lofty, and potentially world-altering goal: to build artificial general intelligence, or software that can take on all kinds of tasks that are typically performed today by humans.”
The whole piece is worth reading to get a more nuanced read on her full resume.
But the broader point I wanted to higlihgt as the the Bigger Picture is the following:
OpenAI is unusual in this tech wave in essentially building SEVERAL startups all scaling globally and concurrently, in a unique opportunity. They explain two of them in their memo on the new appointment of ‘CEO of Applications, Fidji SImo:
“We started OpenAI as a research lab with a mission to ensure artificial general intelligence (AGI) benefits everyone.
“Over the past two and a half years, we have started doing two additional big things. First, we have become a global product company serving hundreds of millions of users worldwide and growing very quickly. More recently, we’ve also become an infrastructure company, building the systems that help us advance our research and deliver AI tools at unprecedented scale. And as discussed earlier this week, we will also operate one of the largest non-profits.”
“Each of these is a massive effort that could be its own large company. We’re in a privileged position to be scaling at a pace that lets us do them all simultaneously, and bringing on exceptional leaders is a key part of doing that well.”
And that is a critical differentiation vs prior leading tech startups in prior waves. Many of the AI applications to come from OpenAI will likely be a deep and broad array of products and services that could each be potential companies at scale of their own. This is while the company executes on big changes to its core corporate structure.
Eveything from AI Reasoning to Agents to AI Search to AI Super Assistants to AI Browsers, to AI Voice, and beyond. This new appointment is an early org change to set the stage for those concurrent executions. All requiring extreme focus, resources, and execution. Not to mention managing key global partnerships with other major tech companies like Microsoft.
This requires super experienced executives earlier within the AI startups than every before in this AI Tech Wave. To align execution imperatives across AI Applications, and their Business/Finance priorities. And that is the Bigger Picture of note this Sunday. Stay tuned.
(NOTE: The discussions here are for information purposes only, and not meant as investment advice at any time. Thanks for joining us here)
