Meta considered acquiring Perplexity before investing in Scale AI

Meta Platforms Inc. deliberated the acquisition of Perplexity AI, a burgeoning player in the artificial intelligence sector, prior to making a substantial investment in Scale AI. The discussions surrounding this potential acquisition underscore Meta's strategic focus on strengthening its capabilities in AI-driven technologies . However, the decision was ultimately made to invest $14.3 billion in Scale AI instead, resulting in a significant 49% stake in the company. This pivot illustrates Meta's prioritization of established entities with proven technology over newer startups .

Meta approached artificial intelligence startup Perplexity AI about a potential takeover bid before ultimately investing $14.3 billion into Scale AI, .

The two companies did not finalize a deal, according to two people familiar with the matter who asked not to be named because of the confidential nature of the negotiations.

One person familiar with the talks said it was “mutually dissolved,” while another person familiar with the matter said Perplexity walked away from a potential deal.

One source said the decision was “mutually dissolved,” while another claimed Perplexity walked away.

Both companies declined to comment.

The approach to Perplexity highlights Meta’s push to strengthen its AI capabilities amid rising competition from OpenAI and Google.

Following its investment, Meta now holds a 49% stake in Scale AI, though without voting rights. Earlier this year, Meta also tried to acquire Safe Superintelligence.

Meta has also held early discussions for a computing deal in which Safe Superintelligence would use Meta’s data centre infrastructure, the source said. Representatives for Safe Superintelligence did not immediately respond to a request for comment.

Other Big Tech firms, including Google and Amazon.com, have tried to establish themselves as the backbone of the AI ecosystem by providing chips and cloud computing resources to AI startups. Meta has not gone this route to date.

Furthermore, Meta's interest in Perplexity extended beyond mere acquisition discussions; efforts were made to recruit its CEO, Aravind Srinivas. This indicates that Meta is not only keen on acquiring companies but also actively seeking top talent within the industry . By investing heavily in Scale AI while maintaining interest in Perplexity’s leadership, Meta aims to bolster its competitive edge within the rapidly evolving field of artificial intelligence.

Read more

Sara H

Also on site :

• FDA approves breakthrough HIV prevention drug
• DNA study sheds light on the identity of the enigmatic 'Dragon Man' fossil
• The No-Break-In Sneakers With a Notorious Waitlist Are Legitimately *So* Comfortable