Mar 21, 2024

Microsoft Paid AI Startup $650 Million. Prof. Emeritus Steve Weber Reflects on the Deal

From Reuters

Microsoft pays Inflection $650 mln in licensing deal while poaching top talents, source says

By Krystal Hu and Harshita Mary Varghese

Microsoft (MSFT.O), opens new tab has agreed to pay AI startup Inflection about $650 million in cash in an unusual deal that would allow Microsoft to use Inflection’s models and hire most of the startup’s staff including its co-founders, a person familiar with the matter told Reuters on Thursday.

The high-profile AI startup’s models will be available on Microsoft’s Azure cloud service, the source said. Inflection is using the licensing fee to pay Greylock, Dragoneer and some other investors, the source added, saying the investors will get a return of 1.5 times what they invested...

“This deal could be seen as an effort to reduce competition in the foundation model markets, as Infection is going to be a shell of its former self,” said Steven Weber, professor at the UC Berkeley School of Information, who has received research funding from technology firms including Google and Microsoft...


Steven Weber is a professor emeritus of the I School, retiring in 2021. He previously served as the faculty director at the Center for Long Term Cybersecurity (CLTC).

Last updated:

March 25, 2024