Meta Platforms has invested in US-based firm Scale AI in a deal that values the data-labelling startup at $29 billion. After the deal, Jason Droege will serve as the interim CEO of the AI firm.
Meta’s stake in the startup will give its 28-year-old CEO, Alexandr Wang, an opportunity to play a prominent role in the tech giant’s artificial intelligence strategy.
Wang to lead Meta’s superintelligence team
The Facebook owner will reportedly take a 49 per cent stake for $14.3 billion.
“We will deepen the work we do together producing data for AI models and Alexandr Wang will join Meta to work on our superintelligence efforts,” Meta said in a statement reported by Reuters.
The main driver behind Meta’s huge investment in Scale AI was to secure Wang to lead its new superintelligence unit, according to information given to Reuters.
Who is Alexandr Wang?
Wang was born in Los Alamos, New Mexico. His parents were Chinese immigrants who worked as physicists.
The CEO dropped out of the prestigious MIT to co-found Scale. He was quickly recognised as one of Silicon Valley’s most promising entrepreneurs, who successfully raised capital from blue-chip venture capital firms and achieved billionaire status in his 20s, Reuters said.
Why is Meta poaching Wang ?
Meta, who was once a leader in open-source AI models, has been postponing the launches of new open-source AI models due to staff departures. These AI models are important to rival competitors like Google, OpenAI, and China’s DeepSeek, reported Reuters.
By luring Wang into joining the tech giant, who does not come from a research background, yet built a major AI business, Meta CEO Mark Zuckerberg is betting that Meta’s AI efforts can be turned around by an adept business leader more in the mold of Altman than the research scientists at the helm of most competing labs, reported Reuters.
What’s next for Scale AI?
Meta doesn’t plan to take a board seat in Scale, as people with information told Reuters.
A few employees from Scale, among a team of 1,500 people, will move to Meta with Wang as he will continue to serve on the Scale’s board.
However, it’s still unclear if this deal will come under any regulatory scrutiny. Meta has earlier been sued by the US Federal Trade Commission, which alleged that it illegally acquired Instagram and WhatsApp to reduce competition.
About Scale AI
The startup was founded in 2016 as a platform that provides vast amounts of accurately labelled data, which is crucial for training sophisticated tools like OpenAI’s ChatGPT.
To do so, Scale set up subsidiary platforms such as Remotasks and Outlier to recruit and manage gig workers who manually label the data, according to Reuters.
Before Meta bought a stake, it was valued at nearly $14 billion in a May 2024 funding round that included Nvidia, Amazon and Meta among its backers.
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