Half of xAI's Founders Just Walked Out

Hey,

Something strange is happening at xAI.

In July 2023, Elon Musk announced his new AI company with a lot of fanfare. He assembled 12 of the smartest AI researchers and engineers he could find. The goal was ambitious: build an AI company that could compete with OpenAI and Google.

Less than three years later, half of them are gone.

The latest exits happened this week. Jimmy Ba, a respected AI researcher and professor at the University of Toronto, announced he was leaving. The day before, Tony Wu quietly departed too. That makes six co-founders who've left since the company started.

For context, xAI is currently valued at over 200 billion dollars. And half the founding team just walked away.

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These exits are happening right as xAI is going through major changes.

Just days before Jimmy Ba left, Musk announced that SpaceX would acquire xAI before taking it public this year. That's a huge structural shift for a company that's barely three years old.​

There's also been growing scrutiny around xAI's product, Grok. A recent update allowed users to generate inappropriate AI images, which created a wave of negative press and raised serious questions about the company's content moderation.​

It's worth noting the contrast. While xAI is losing co-founders, Anthropic has kept its entire founding team intact. That's rare in the fast-moving AI world, and it says something about company culture and stability.

Neither Ba nor Wu gave detailed public reasons for leaving.​

Ba posted on X saying it was "time to recalibrate" and that "2026 is gonna be insane and likely the busiest year for the future of our species." That's a very diplomatic way of not saying much at all.​

Wu didn't clarify his plans either.​

When senior people leave and don't explain why, it usually means one of two things: they can't say what they want to say, or they're choosing not to. Either way, it signals discomfort.

There could be cultural clashes between academic researchers who value careful, methodical work and Musk's famously intense, move-fast management style. There might be strategic disagreements about where xAI is heading as a product and business.​

Losing six co-founders in under three years doesn't automatically mean xAI is failing.

The company is still valued at over 200 billion dollars. It has deep financial backing. It's building real products. And Musk has a track record of making ambitious bets work, even when people doubt him.

But founder exits at this pace do raise questions about morale, direction, and whether the company can retain top talent long-term.

AI is an incredibly competitive field right now. The best researchers and engineers have options. They can work at OpenAI, Anthropic, Google, or start their own companies. If xAI is losing people at this rate, it suggests that working there isn't as appealing as it looked from the outside in 2023.

The next few months will tell us more. xAI is moving toward an IPO, integrating with SpaceX, and trying to prove it can compete with the big AI players. The remaining six co-founders will have to carry that weight without the other half of the team that started this journey with them.

Whether that's sustainable or just the beginning of more exits is something we'll find out soon enough.

See you soon,
The Default State