Musk says xAI must be ‘rebuilt’ amid co-founder exodus, SpaceX IPO

He became the richest person in the world less than six weeks after Elon Musk merged SpaceX with xAI in a deal worth $1.25 trillion. acceptance He said the AI ​​initiative “wasn’t built right the first time, so it’s being rebuilt from the ground up.”

Musk went to X, now owned by SpaceX, to comment after some of xAI’s co-founders recently made exits. The latest took place this week at the meeting between Zihang Dai and Guodong Zhang. reportedly left the company.

Last month, influential researcher Jimmy Ba announced his departure. to mail He thanked Musk on X and wrote: “Grateful to help co-found the startup.” This comes after Tony Wu said he would be leaving. Toby Pohlen followed them out the door later in February.

A month ago, Musk’s automaker Tesla announced that it had agreed to invest $2 billion in xAI, tied to $20 billion in financing the company had previously announced.

The xAI exodus, which leaves Musk with just a couple of people who co-founded the company with him in 2023, comes as SpaceX prepares to go public later this year; If this happens, it will likely be a record IPO.

SpaceX’s merger with xAI last month valued the reusable rocket company at $1 trillion, according to documents viewed by CNBC, while the artificial intelligence part of the business was labeled at $250 billion.

Musk previously used xAI to acquire social network X, formerly Twitter, in another stock transaction announced last March.

SpaceX on Thursday said it has hired two programmers from its red-hot AI coding startup cursorAndrew Milich and Jason Ginsberg. Finance Times Musk ordered a series of layoffs after seeing the rapid success of coding tools from prolific AI rivals OpenAI and Anthropic, the company reported Friday, citing people familiar with the matter.

“Over the past few years, many talented people have had offers and even @xAI interviews rejected,” Musk said. wrote to x Friday early. “I am sorry.”

Musk added that he and Barış Akis, who heads up engineering talent at xAI, “reviewed the company’s interview history and came back to promising candidates.”

In addition to losing early talent and falling behind in AI-powered coding, XAI is facing a series of controversies surrounding its chatbot and image generator Grok, which has been the subject of government investigations in several international jurisdictions.

The problems began when Grok allowed users to easily create non-consensual sexual images or deepfake porn by altering photos or videos of real adults and children.

Under Trump’s presidency, xAI’s Grok won government contracts from the Department of Defense and General Services Administration.

xAI, meanwhile, has been spending billions of dollars in recent years to strengthen the power and data infrastructure in and around Memphis, Tennessee. In Mississippi, the company received permission to build one of the largest power plants in the region to use natural gas-burning turbines for xAI’s data centers.

Tesla’sThe company, which accounts for almost all of Musk’s liquid wealth, is working with xAI in a variety of ways. The EV manufacturer integrates Grok into vehicle infotainment and navigation systems and uses Grok models along with the development of Optimus humanoid robots.

Tesla also sold hundreds of millions of dollars worth of large backup batteries to xAI for use in its data centers.

Musk and xAI did not immediately respond to requests for comment.

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