Microsoft's habit of employing top AI talents of companies it financially backs may backfire

Microsoft bought Inflection for $650 million last month.

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Key notes

  • Microsoft bought Inflection for $650 million last month.
  • Then, its former CEO and some of the most important employees went to join Microsoft.
  • It could backfire. Now, a new exec is reportedly got cold feet after learning about the move.
Microsoft building

Microsoft bought off Inflection, an AI startup company, for a whopping $650 million last month. Since then, the company saw a massive exodus of many AI talents, including its former CEO Mustafa Suleyman, to the Redmond tech giant instead. 

That said, Microsoft seems to have a habit of employing the top AI talents of companies that it financially supports, but that move may backfire. Business Insider received a leaked internal memo about how Suleyman’s move to Microsoft has somewhat made current Inflection employees worried.

In the Wednesday report, Calvin Lee, formerly of Uber, was set to join Inflection but got cold feet when he learned that Microsoft hired away Inflection’s top brass. As for Inflection, former Mozilla’s top official Sean White has been appointed as the CEO.

An email from Greylock’s Christine Kim revealed Lee’s concerns and hinted that he might receive a job offer from Microsoft soon. Greylock, which helped Lee land the Inflection gig, has ties to both companies. With Inflection’s leadership in flux, Lee had second thoughts about his new role, as that Microsoft move “may have dented the startup’s ability to recruit technical talent.”

You may also recall the fiasco inside Microsoft-backed OpenAI when its CEO, Sam Altman, was fired and re-hired. There were also top OpenAI brass, like Greg Brockman and several other employees, and then Microsoft made a fast move by hiring them to lead “a new advanced AI research team.”

That move did not materialize, as Altman and Brockman shortly returned to OpenAI, but it does send a message: Venture capital firms can invest in startups, help them grow, and often facilitate their acquisition by larger companies and sometimes, the best talents can go to the bigger company.

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