OpenAI walks back statement it wants a government 'backstop' for its massive loans — company says government 'playing its part' critical for industrial AI capacity increases

OpenAI's Chief Financial Officer, Sarah Friar, has walked back claims she made in an interview with the Wall Street Journal. Where she originally said that OpenAI was "looking for an ecosystem," where various institutions could back OpenAI through financing arrangements, like providing a "guarantee," she's now said that wasn't the intention. Instead, Friar says the company wants the US government to "play its part," in maintaining industrial capacity, she said in a post on LinkedIn.

"I want to clarify my comments earlier today. OpenAI is not seeking a government backstop for our infrastructure commitments. I used the word “backstop,” and it muddied the point," Friar said in her post.

"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."

She then went on to praise the US government for being "incredibly forward-leaning," and clearly understood that AI was a strategic asset. That is an interesting way to explain away her earlier comments, which do seem quite explicit when taken within the original context.

In an interview with WSJ's Sarah Krouse, Friar said that OpenAI's main goal has been to maintain its technological lead, with both the models and the hardware it uses for training and inference. That means buying up the latest chips before the competition, which is where its need for such incredible investment comes in.

However, it was in discussing the financing of these deals and investments that Friar suggested OpenAI would benefit from a government guarantee of its loans. "This is where we're looking for an ecosystem of banks, private equity, maybe even governmental... the way governments can come to bear," Friar said.

When asked for clarification, she continued; "First of all, the backstop, the guarantee that allows the financing to happen, that can really drop the cost of the financing but also increase the loan to value, so the amount of debt you can take on top of an equity portion for..." Krouse then pressed her, asking if that meant a "federal backstop for chip investment?"

"Exactly," Friar said. "I think we're seeing that." She went on to praise the US government as understanding how AI is a "strategic asset," and that it was important for competition with China. That was what her LinkedIn post seemed to lean on more as the substantive part of the interview, even if it only appears to be a minor point in the original clip. When Krouse asked if OpenAI was discussing a form of financing guarantee with the White House, Friar deflected, saying, "We're always being brought in by the White House, to give our point of view as an expert on what's happening in the sector."

Almost seeming to cotton on that she'd said something dramatic in the interview, she then said that there was "nothing to announce, nothing that's going on right now."

Elsewhere in the interview, Friar said that OpenAI was not working on an IPO at this time and suggested the market should embrace AI further instead of worrying about a bubble.

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