Meta’s failed attempt to buy the giant safe artificial intelligence company founded by OpenAI co-founder Ilya Sutskever, and its fallback plans to hire prominent tech leaders to boost its AI team.
Article contents:
- Introduction
- Acquisition attempt
- Alternative plan
- Escalating talent war
- Key figures
- Industry impact
- Strategic implications
- Conclusion
Introduction
When Meta CEO Mark Zuckerberg lured Scale AI founder Alexander Wang last week as part of a $14.3 billion investment in the AI startup, it was apparently just the beginning. Zuckerberg’s multi-billion-dollar AI hiring spree has now turned to Daniel Gross, CEO of Ilya Sutskever’s Safe Superintelligence, and former GitHub CEO Nat Friedman.
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But things did not go down the way Zuckerberg planned. Earlier this year, Meta tried to buy Safe Superintelligence, which was reportedly valued at $32 billion in an April funding round. Sutskever, who launched the startup just a year ago shortly after leaving OpenAI, rebuffed Meta’s efforts, as well as the company’s attempt to hire him.
Acquisition attempt
Sources, speaking on condition of anonymity because the information is confidential, said the talks ended. Shortly after those talks ended, Zuckerberg began negotiating with Gross, the sources said. In addition to his role at Safe Superintelligence, Gross runs a venture capital firm with Friedman called NFDG, their shared initials.
Both men are joining Meta as part of the deal, and will work on products under Wang, one source said. Meta, meanwhile, will acquire a stake in NFDG, according to multiple sources. The Information was first to report Meta’s plans to hire Gross and Friedman.
Gross, Friedman, and Sutskever did not respond to CNBC requests for comment. A Meta spokesperson said the company “will share more about our superintelligence efforts and the amazing people joining this team in the coming weeks”.
Alternative plan
Zuckerberg’s aggressive hiring tactics are escalating an AI talent war that has recently reached new heights. Meta, Google, and OpenAI, alongside a host of other large corporations and high-value startups, are racing to develop the strongest large language models and push toward artificial general intelligence, or AI considered equal to or greater than human intelligence.
Last week, Meta agreed to pump $14.3 billion into Scale AI to bring in Wang and a handful of other top engineers while securing a 49% stake in the startup. Altman said on the latest episode of the “Uncapped” podcast that Meta tried to lure OpenAI employees by offering high signing bonuses reaching $100 million, along with even larger annual compensation packages. Altman said that “none of our best people decided to take them up on that”.
Escalating talent war
Altman said: “I’ve heard Meta considers us their biggest competitor. Their current AI efforts haven’t worked as they hoped and I respect that they are aggressive and continue trying new things.” Meta did not respond to a request for comment on Altman’s remarks. OpenAI, for its part, has gone to similar lengths, paying about $6.5 billion to hire iPhone designer Jony Ive and acquire his emerging hardware startup io.
Elsewhere, the founders of AI startup Character.ai were re-recruited to Google last year in a multi-billion-dollar deal, while DeepMind co-founder Mustafa Suleyman was brought on by Microsoft in a $650 million talent acquisition from Inflection AI.
Key figures
In Gross, Zuckerberg gets a long-time entrepreneur and AI investor. Gross founded the Q search engine, which was acquired by Apple in 2013. He was a senior executive at Apple and helped lead machine learning efforts and Siri development. He was later a partner at startup accelerator Y Combinator, before co-founding Safe Superintelligence alongside Sutskever.
Friedman founded two startups before becoming CEO of GitHub following Microsoft’s acquisition of the code-sharing platform in 2018. NFDG has backed Coinbase, Figma, CoreWeave, Perplexity, and Character.ai over the years, according to PitchBook. It is unclear what happens to its investment portfolio in the Meta deal, a source said.
Industry impact
These moves reflect the intensely competitive nature of the current AI industry. Companies recognize that success in this field depends heavily on the quality of talent they can attract and retain. The massive sums spent on hiring demonstrate how vital this sector is for the tech future.
Massive investments in buying talent and startups also show how large companies are trying to accelerate the development of their AI capabilities rather than relying on slow internal development. This approach could lead to rapid developments but also raises questions about the long-term sustainability of this strategy.
Strategic implications
For Meta, these investments represent a massive bet that AI will be central to the company’s future. With the challenges it faces in attracting top talent, the company is trying to use its financial muscle to compete with companies like OpenAI that have an advantage in technical and cultural appeal.
Success or failure in this strategy will largely determine Meta’s ability to compete in the future AI market. If it can build a strong team and develop advanced technologies, it may be able to reclaim its position as a technology leader. But if it fails, it may find itself permanently lagging behind its competitors.
Conclusion
Meta’s attempt to buy Sutskever’s company and its fallback plans to hire prominent tech leaders show the intensive nature of competition in the AI field. These moves reflect large corporations’ realization of the importance of AI as a pivotal technology for the future, and their willingness to spend massive amounts to secure their place in this race. Success in attracting and retaining top talent will be a decisive factor in determining the winners and losers in this rapidly evolving field. The future will show whether Meta’s big-spending talent strategy will pay off or if other factors like culture and vision will ultimately be more important.
