Asger Risom
More than half of xAI’s original cofounders have now left the company, with the latest departures coming amid a restructuring, a merger with SpaceX and mounting pressure in the AI race — raising fresh questions about internal tensions at Elon Musk’s startup.
Elon Musk’s artificial intelligence startup is facing a wave of high-profile departures.
In the space of days, two cofounders and a string of senior technical staff have exited the company — raising questions about what’s happening inside one of Silicon Valley’s most closely watched AI labs.
More than half of the original cofounders who launched xAI in 2023 have now left. The latest resignations include Jimmy Ba and Tony Wu, both of whom thanked Musk publicly for the opportunity before moving on.
A sudden exodus
The departures follow an internal restructuring announced by Musk during a company-wide all-hands meeting. In a post on X, he said xAI had been reorganized “to improve speed of execution.”
“This unfortunately required parting ways with some people,” Musk wrote, adding that the company was still “hiring aggressively.”
The timing is striking. The exits come just as Musk moves to merge xAI with SpaceX in a deal he says will help build orbiting AI data centers — and even a “self-sustaining” city and mass driver on the moon.
For some observers, the combination of ambitious long-term plans and immediate operational shake-ups may signal internal tension over direction and priorities.
Strategy shift?
Several departing staff worked on Grok, xAI’s chatbot, which has already drawn global backlash over the generation of explicit images involving real people. Others focused on reasoning systems, recommendation algorithms and AI tutoring tools.
One former technical staffer, Vahid Kazemi, wrote that “all AI labs are building the exact same thing, and it’s boring,” suggesting frustration with the broader industry’s trajectory.
The exits also coincide with mounting financial pressure. Reports indicate xAI burned through billions last year.
At the same time, SpaceX is reportedly preparing for a potential public offering that could value the rocket company at up to $1.5 trillion — a development that could reshape the combined entity’s priorities.
Culture and consolidation
Musk described the restructuring as necessary to increase execution speed. Former employees, in their farewell posts, praised what one called a “wartime mentality.”
Such language hints at an intense internal culture — one that may not suit every senior engineer or researcher, particularly as the company evolves from startup mode into something more integrated with Musk’s broader empire.
The merger with SpaceX may also mark a pivot away from a pure AI research focus toward infrastructure and long-term space-linked ambitions. That strategic broadening could prompt some founders and early hires to reconsider their role.
A broader signal?
The exodus also arrives amid wider turbulence in the AI sector. Rival labs are racing to develop increasingly powerful models, and concerns over safety, governance and commercialization are intensifying.
If xAI is tightening control while expanding its ambitions, the departure of founding figures may reflect deeper disagreements over pace, product direction or acceptable risk.
Publicly, those leaving have been gracious. Privately, the pattern raises a question that lingers over Musk’s AI venture: is this a routine restructuring — or the sign of a company entering a more volatile phase?
Sources: Business Insider reporting; public posts by departing xAI employees
