Back-to-Back Cofounder Departures Shake the Core Team (Image Credits: Pixabay)
Elon Musk’s artificial intelligence startup xAI has seen half its original co-founders depart, with the latest exits fueling concerns over stability at a pivotal moment.[1][2]
Back-to-Back Cofounder Departures Shake the Core Team
Two prominent co-founders announced their resignations within 48 hours earlier this week. Yuhuai (Tony) Wu, who led reasoning efforts and reported directly to Musk, shared on X that he was embarking on his “next chapter” after “the ride of a lifetime.”[2] Jimmy Ba, who oversaw AI tutoring and safety initiatives, followed suit, expressing pride in xAI’s achievements while thanking Musk for the opportunity.[2]
These moves brought the total to six departures from the 12-person founding team established in 2023. The exits appeared amicable, with insiders noting substantial financial windfalls for those leaving amid a ripe environment for new AI ventures.[1]
A Year of Accelerating Turnover
The past year accounted for five of the six cofounder exits. Kyle Kosic, the infrastructure lead, joined OpenAI in mid-2024. Christian Szegedy departed in February 2025, followed by Igor Babuschkin in August 2025 to launch a venture capital firm.[3] Greg Yang left last month citing health reasons.
Beyond cofounders, at least 11 other employees, including key technical staff, announced departures this week alone. Vahid Kazemi, a former OpenAI and Google researcher, criticized the industry for lacking creativity, stating “all AI labs are building the exact same thing, and it’s boring.”[2] Others like Hang Gao, Ayush Jaiswal, Shayan Salehian, and Simon Zhai cited personal pursuits or new projects.
- Tony Wu: Reasoning team lead
- Jimmy Ba: AI tutoring and safety
- Kyle Kosic: Infrastructure (to OpenAI)
- Christian Szegedy: Research
- Igor Babuschkin: To VC firm
- Greg Yang: Health reasons
Musk Addresses Staff Amid the Wave
Musk convened an all-hands meeting Tuesday night, shortly after the cofounder announcements. He thanked departing employees for their contributions but emphasized that xAI would press forward without them.[4] Discussion centered on ambitious plans, including space-based data centers enabled by SpaceX’s recent acquisition of xAI and potential use of Tesla’s Optimus robots for operations.
The company also merged with X (formerly Twitter) in March 2025. Neither xAI nor Musk issued public statements on the exits, though internal memos addressed a canceled prior all-hands and clarified that the entities would operate separately for now.[4]
Challenges Mount Ahead of Key Milestones
The timing raised eyebrows as xAI prepares for a potential IPO in 2026, following the SpaceX integration. Intense pressure to compete with OpenAI and Anthropic persists, compounded by Grok controversies over generated imagery and past content issues.[3] High turnover in AI talent wars could signal deeper tensions over development pace and resource demands.
Observers noted risks to investor confidence, especially if exits continue. Yet the departures coincided with xAI burning through billions on infrastructure, positioning Musk’s vision for orbital AI computing as a bold counterpoint.[1]
xAI’s ability to retain expertise will prove critical as it navigates mergers, regulatory scrutiny, and the race for AI supremacy. What signals does this exodus send about the startup’s trajectory?
- Six of 12 cofounders gone, five in the last year.
- Recent wave includes 11+ staff exits this week.
- IPO and space data centers loom amid talent crunch.
What do you think about xAI’s challenges? Share in the comments.
