OpenAI’s No. 2 executive Fidji Simo steps down after health battle

The move is the latest executive shake-up within OpenAI as it prepares for a highly anticipated public offering as soon as this year and tries to catch up with its rival Anthropic among business customers. Simo was selected by Chief Executive Sam Altman to lead OpenAI’s product and business divisions, and she was widely expected to take on an even larger role leading the company once it went public. 

Now, Altman will have to find an alternative.

Simo joined last August, and took on many managerial responsibilities from Altman, including overseeing the chief financial officer and chief revenue officer. She said in April that she was taking medical leave, telling staff that her neuroimmune condition had worsened. Her departure created a leadership vacuum at the time, raising questions among investors and employees about the future direction of the company.

Simo was tapped to accelerate ChatGPT’s growth, and she made her mark by introducing ads to the popular chatbot, as well as features such as health advice. She had previously served as the CEO of grocery-delivery app Instacart and as a top executive at Facebook, making her a strong choice to oversee the growth of OpenAI’s consumer-facing business.

But ChatGPT’s growth stalled towards the end of last year, contributing to missed internal revenue goals. The company abruptly pivoted its focus to building AI-powered coding tools for businesses after falling behind Anthropic in that lucrative market. Simo led early efforts to create a coding-focused “superapp,” which OpenAI launched today, and cut side projects such as the video-generator app Sora.

Anthropic recently surpassed OpenAI’s valuation for the first time, a reflection of its newfound dominance in the AI race. The rival remains the default choice for most businesses looking to adopt AI tools, though OpenAI is aggressively courting customers with its own offerings. The two sides are now locked in a costly price war that could further delay profitability ahead of the companies’ planned IPOs. 

At the Allen & Co. retreat in Sun Valley, Idaho, this week, OpenAI executives discussed how the company plans to compete with Anthropic to win over more enterprise customers, according to a person who spoke with them.

In her internal note Thursday, Simo said that her product and business responsibilities would be divided among President Greg Brockman, CFO Sarah Friar, and Chief Strategy Officer Jason Kwon. Denise Dresser, OpenAI’s chief revenue officer, will now report to Brockman. 

“This has been one of the hardest decisions of my career, but my body left me no choice—my symptoms became as loud as I am stubborn,” she wrote.

Simo said in a post on X Thursday that when she went on leave people told her that she was courageous for prioritizing her health. “The truth is that I am only making this decision now because I failed to make it many times before,” she wrote.