An insider has disclosed that Mark Zuckerberg, frustrated by Meta’s current standing in the artificial intelligence arena, is prepared to spend tens of billions of dollars to convince Alexander Wang, CEO of Scale AI, to join Meta.
Investment Deal in the Works
According to a person with knowledge of the matter, who asked to remain anonymous due to the confidentiality of the deal’s terms, Meta is finalizing an investment of $14 billion in Scale AI. Earlier this week, reports suggested that Meta’s investment in Scale AI could surpass $10 billion, and on Tuesday, The Information reported that the investment would be nearly $15 billion.
The Appeal of Alexander Wang
Two former Meta AI employees, also choosing to remain anonymous, stated that as the founder of one of the most prominent AI startups, Alexander Wang has earned a reputation as an ambitious leader. He not only grasps the technical intricacies of AI but also knows how to build a company that extends beyond pure research. Given the lackluster reception of Meta’s latest Llama AI model, Zuckerberg is banking on Wang to better fulfill Meta’s AI aspirations.
Strategic Approach and Regulatory Concerns
Rather than directly acquiring Scale AI, Meta appears to be adopting a strategy similar to those of Google and Microsoft. These tech giants have recruited top AI talent from startups like Character.AI and Inflection AI and acquired significant stakes in these companies instead of outright acquisitions. Multiple insiders noted that Meta is currently under review by the US Federal Trade Commission (FTC) for antitrust allegations, and the company is eager to avoid further provoking regulators by attempting an acquisition of Scale AI.
Details of the Potential Deal
As reported by The Information, as part of the deal, Meta would acquire a 49% stake in the data tagging and annotation startup, Scale AI. Wang would assist in leading a new artificial intelligence research laboratory at the social networking company, and some of his colleagues are also expected to join.
Scale AI’s Background
Founded in 2016, Scale AI has attracted attention in the era of generative artificial intelligence by helping large tech companies such as OpenAI, Google, and Microsoft prepare data for training advanced AI models. According to two insiders, Meta is one of Scale AI’s largest clients. Approximately a year ago, Scale AI was valued at $14 billion in a round of financing.
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