Meta stumps up $14B for 49% of Scale AI

  META

Meta Acquires 49% of Scale AI for $14B in Superintelligence Push

Meta's $14 billion investment in Scale AI marks a strategic pivot in the AI arms race, acquiring 49% of the company while appointing its CEO Alexandr Wang to lead Meta's "superintelligence" unit.

Need to know:

• Mark Zuckerberg framed the Scale AI acquisition as essential to Meta's "superintelligence" roadmap, bringing specialized data labeling expertise in-house to enhance AI training capabilities across platforms.

• Scale AI's Alexandr Wang will join Meta's executive team while maintaining his role at Scale, creating a unique dual leadership arrangement that preserves Scale's operations while aligning its technology with Meta's vision.

• At Cannes, Meta unveiled AI agents for WhatsApp and Messenger that businesses can embed directly into advertisements, creating conversational commerce experiences without app switching.

• New AI-powered creative tools transform static images into multi-scene videos and generate personalized ad copy based on audience segments, addressing content creation bottlenecks.

• WhatsApp is testing its first native ad placements in the Updates tab while introducing channel subscriptions, opening new revenue streams on its previously ad-free platform.

This investment reshapes the competitive landscape in generative AI, particularly for advertising applications. With industry analysts projecting the advertising AI tools market to reach $45 billion by 2027, Meta has positioned itself to capture a substantial portion through vertical integration of data labeling and consumer-facing applications.

   APPLE V GOOGLE  

Apple and Meta Race to Acquire Perplexity, Challenging Google's Search Dominance

Apple and Meta are simultaneously pursuing AI search startup Perplexity, a company that's grown from a dismissed "AI wrapper" to a $14 billion valuation in just two years. This dual courtship highlights Silicon Valley's urgent race to challenge Google's search dominance through conversational AI interfaces that fundamentally reimagine how users find information online.

Need to know:

• Bloomberg first reported Meta's approach to Perplexity before Meta redirected $14.3 billion to Scale AI, while Apple's interest marks a potential departure from its traditionally conservative acquisition strategy.

• Perplexity has attracted 15 million users by delivering a conversational search experience that includes source citations and multimodal capabilities, addressing growing frustrations with Google's search quality.

• For Apple, acquiring Perplexity could solve its AI limitations while providing an alternative to its Google Search partnership, which faces increasing regulatory scrutiny and costs billions annually.

• Meta's interest aligns with Zuckerberg's aggressive AI talent acquisition strategy, recently offering OpenAI employees signing bonuses reaching $100 million to jump ship.

• Perplexity transforms traditional keyword searches into natural conversations where users can refine questions without starting over, creating a more intuitive information discovery process.

• Neither tech giant has confirmed formal acquisition talks, leaving multiple possible outcomes for the startup's future.

This competition for Perplexity represents a pivotal moment in search technology evolution. As users increasingly prefer conversational interfaces for complex information needs, whoever secures Perplexity's technology gains a significant advantage in reshaping how the next generation accesses knowledge online.

  TALENT  

• Talent war intensifies as OpenAI's Sam Altman reveals Meta's attempt to poach top AI experts with $100 million signing bonuses, highlighting the fierce competition for skilled developers amid the race for artificial general intelligence.

• Pentagon taps OpenAI for a $200 million "frontier AI" pilot project that will address national security challenges in warfighting and administration, despite the company's policy against using its technology for weapons development.

• Smart eyewear competition heats up as Meta partners with Oakley</a> to launch AI glasses featuring cameras, speakers and Meta AI app, following similar moves by Google and Snap in this emerging hardware category.

• OpenAI's rapid expansion sees the company nearly tripling in size with 330 open positions globally, reflecting "unprecedented pressure to grow" as it acquires strategic companies and intensifies competition for AI talent in the race toward artificial general intelligence.

• Nvidia's strategic investments have dramatically expanded over the past two years, with the GPU giant backing over 80 AI startups across computing infrastructure, language models, and robotics to strengthen its AI ecosystem dominance.

   BIG BETS 

US AI Funding Surge: 24 Startups Secure $100M+ in 2025

American AI startups are riding a powerful funding wave in 2025, with 24 companies already securing $100M+ investments this year.

Need to know:

• OpenAI dominates the landscape after raising a historic $40 billion round in March, pushing its valuation to $300 billion – the largest AI funding deal to date.

• Anthropic secured $3.5 billion in Series E funding, strengthening its position as OpenAI's primary competitor in the foundation model space.

• Anysphere raised $900 million specifically for Cursor, its AI-powered coding assistant that's gaining traction among developers.

• Q1 2025 outpaced the same period last year in mega-rounds, with multiple billion-dollar investments despite broader tech market fluctuations.

The sustained capital influx into AI startups, even amid economic uncertainties in other sectors, demonstrates investor conviction that artificial intelligence represents the next transformative technology wave rather than a temporary bubble.

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QUICK BYTES

• Meta's Mark Zuckerberg aggressively courts AI startups to revamp his strategy while assembling a powerhouse team that signals a dramatic tech battlefield shift.

• OpenAI prepares antitrust lawsuit against Microsoft as the once-cozy partnership fractures over intellectual property</a> rights and IPO tensions.

• Mattel partners with OpenAI to transform childhood play as the iconic toymaker brings artificial intelligence to beloved brands like Barbie and Hot Wheels, promising innovative products later this year.

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Dan @ The Revolution AI