Musk Reorganises xAI After SpaceX Merger and Ahead of Blockbuster IPO
The restructuring announced Wednesday follows the recent departures of several co-founders at the three-year-old artificial intelligence company, leaving only half of the startup’s 12 co-founders and raising questions about stability as Musk tries to compete with OpenAI and Google on all fronts.
“We organize because we’ve reached a certain scale. We organize the company to be more effective at that scale. Now, naturally, when that happens, there are some people who are better suited for the early stages of a company and less suitable for the later stages,” Musk said at the xAI general meeting, according to video footage posted by the company on X.
The changes come after co-founders Tony Wu and Jimmy Ba said in social media posts this week that they were resigning from the artificial intelligence firm they founded with Musk.
Traffic on xAI’s chatbot website Grok.com, although growing steadily, remains a distant third globally, accounting for about 3.4% of productive AI chatbot traffic, compared with 64.5% for ChatGPT and 21.5% for Google Gemini, according to January data from Similarweb.
‘INTERSTELLAR TARGETS’
During the all-hands meeting, Musk outlined plans to build a full-scale AI company competing on large language models, image and video rendering systems, and coding tools as xAI tries to catch up with its rivals. He and other executives said the company is trying to recruit talent as competition for top AI researchers intensifies.
“We’re hiring and we’re looking for smart, smart people. This is not an easy place to work… It’s a grind, but I think we have interstellar ambitions,” he said.
Executives highlighted long-term plans that include launching SpaceX-backed orbital data centers at what Musk described as being on the order of 100 to 200 gigawatts annually, along with access to what they described as a training cluster equivalent to 1 million Nvidia H100 GPUs as an attraction for researchers.
SpaceX is gearing up for one of the largest IPOs ever after announcing last week that it would acquire xAI to create a $1.25 trillion company, and plans to go public later this year to help finance Musk’s goal of building data centers in space.
The company also noted the rapid progress it has made in its image and video rendering models, saying that xAI creates six times more images than Google’s viral product Nano Banana. The Grok chatbot has also faced criticism from many regulators and legislators around the world for creating sexually explicit images.
xAI has been reorganized into four main areas. Aman Madaan is expected to lead Grok’s core model and voice initiatives, while Manuel Kroiss is expected to head up machine learning infrastructure efforts as well as coding models. Co-founder Guodong Zhang will head the xAI Imagine team focused on multimedia, while Toby Pohlen will lead the Macrohard team leading efforts to automate company processes.
Executives have called coding a priority area, and Musk said he expects Grok Code to become “cutting edge” within two to three months in a competitive space where OpenAI and Anthropic are investing heavily due to strong demand.
“Things will progress to a point, perhaps by the end of this year, where you won’t even bother coding. The AI is building the binary directly,” Musk said.
