Data-labeling company Scale AI announced on Friday that it has secured a substantial investment from Meta, valuing the startup at $29 billion. In conjunction with this investment, co-founder and CEO Alexandr Wang will step down from his role to join Meta, where he will contribute to the company’s AI initiatives. Reports suggest that Meta invested approximately $14.3 billion to acquire a 49% stake in Scale AI. This startup is vital for generating and labeling data that trains large language models, which are crucial for the advancement of generative AI technology.
A spokesperson for Meta confirmed the investment, stating that the strategic partnership will enhance collaboration in producing data for AI models, with Wang joining Meta to focus on superintelligence projects. In Wang’s absence, Jason Droege, Scale AI’s current chief strategy officer, will take over as interim CEO. The funds from Meta’s investment will be directed towards settling obligations with investors and shareholders, as well as supporting future growth. Importantly, Scale AI stressed that it will maintain its independence, and Wang will continue to serve as a director on the company’s board.
This investment marks a significant move for Meta as it seeks to strengthen its AI capabilities, particularly as competitors like Google, OpenAI, and Anthropic advance. Reports indicate that Meta has faced challenges in retaining top talent, with a loss of 4.3% of its leading experts to other AI labs last year. For several years, prominent AI labs, including OpenAI, have relied on Scale AI for data production and labeling. Recently, Scale AI has begun hiring highly qualified professionals, such as PhD scientists and senior software engineers, to enhance the quality of data generated for cutting-edge AI development.