In the spring of 2016, Alexandr Wang (no relation), dropped out of MIT to found Scale AI.

Before starting Scale, Alexandr:

• qualified for the Math Olympiad Program, the US Physics Team, and was a USACO finalist

• worked for Quora as a software engineer

• developed algorithms at Hudson River Trading Co., a high frequency trading firm

Scale AI got into Y-Combinator’s S16 batch.

The rest is history.

Last week, Meta announced that it would pay $14B+ for a 41% stake in Scale AI.

→ Alexandr will take a top position at Meta, leading a new lab dedicated to the pursuit of artificial general intelligence.

→ Meta did not buy Scale AI outright to avoid antitrust regulators (they are currently on trial against the FTC)

→ This AI investment is Meta’s biggest yet

Scale AI is a data labeling business, working hand in hand with the largest tech companies (OpenAI, Microsoft, Meta) to prepare the unstructured data that feeds models.

Meta’s investment is a bet that Alexandr will be able to help Meta build a better ChatGPT.

The AI war just got a lot more interesting.

Zuckerberg has been incredibly aggressive in his willingness to deploy capital for AI talent.

On a podcast with his brother, Sam Altman claimed that Zuckerberg was offering $100M signing bonuses to poach OpenAI employees.

Zuck’s aggression stems from frustration with Meta’s current capabilities.

Scale doesn’t just bring Meta an AI cash cow - in fact, a cohort of Scale’s largest customers ditched the data labeling company after the acquisition was announced. Microsoft, Google, and xAI were some of the biggest names to cut ties.

• Google alone was expected to pay Scale AI $200M in 2025

What Meta gets from Scale is real intelligence.

Alexandr Wang has deep insight into how other major model providers built their engines. Most of that was acquired through working so closely with OpenAI, Google, Microsoft, etc., but some of that was also earned through a direct relationship with Sam Altman.

Wang has been close with Altman for years, and the two even lived together for months during the COVID-19 pandemic. There are probably less than a handful of people in the world that know more about OpenAI’s inner workings than Wang.

One of those people is Ilya Sutskever, former OpenAI co-founder and current founder of Safe Superintelligence. Zuck tried to lure him into Meta’s realm and add Ilya to his collection of AI avengers, but Sutskever turned down the acquisition offer.

Unfortunately, it looks like another Safe Superintelligence founder is having a harder time resisting.

As of yesterday, Meta is in advanced talks to hire Daniel Gross, CEO and co-founder of Safe Superintelligence, and take a stake in his venture fund as well.

The shopping spree continues.

Poll Results

Headlines

• Buss family sell Lakers to Mark Walter at $10B valuation. ESPN 

• Meta to hire AI investors Nat Friedman and Daniel Gross. PYMNTS

• Six month old company Base44 sells to Wix for $80M cash. TC

• Sequoia backed Crosby launched an AI-powered law firm. TC

• Dozens of Olympic sports have been cut in wake of House vs. NCAA. FOS

• Scale AI founder Alexandr Wang says he’s waiting for Neuralink before having kids. BI