Meta is on the verge of investing $14 billion in Scale AI, a prominent data-labeling and annotation startup, according to sources familiar with the matter. As part of the deal, Scale AI’s co-founder Alexandr Wang is expected to join Meta to lead a new AI research lab, bringing his expertise in AI’s technical complexities and business acumen to the social media company.
The investment comes as Meta’s CEO, Mark Zuckerberg, is growing increasingly frustrated with the company’s standing in the AI landscape, particularly compared to rivals like OpenAI. Meta has been struggling to keep pace with the rapid advancements in AI, and Zuckerberg is willing to spend billions to catch up.
Wang, who has built a reputation as an ambitious leader in the AI space, will be tasked with helping Meta better execute on its AI ambitions. He will be joined by some of his colleagues from Scale AI, and the team will work on improving Meta’s AI models, including the Llama family of models.
The deal is significant not only because of its size but also because it reflects Meta’s strategy to partner with AI startups rather than acquiring them outright. This approach is likely driven by Meta’s ongoing antitrust trial with the Federal Trade Commission, as well as a desire to avoid regulatory scrutiny.
Scale AI has been a key player in the AI ecosystem, helping major tech companies like OpenAI, Google, and Microsoft prepare data for training cutting-edge AI models. Meta is one of Scale AI’s biggest customers, and the investment will likely deepen their partnership.
Wang’s appointment as the head of Meta’s new AI research lab is seen as a major coup for the company. He has been vocal about the need for the US to invest in AI infrastructure to compete with China, and his views align with Zuckerberg’s concerns about the growing competition from Chinese tech companies.
The investment and Wang’s hiring are expected to boost Meta’s AI capabilities, particularly in the area of data labeling and training. With Wang’s expertise and the collective knowledge of his team, Meta hopes to gain a competitive edge in the AI landscape.
Meta’s AI Challenges
Meta has been facing significant challenges in its AI efforts, including the lukewarm reception of its Llama 4 AI models. The company’s GenAI unit has undergone a reorganization, with Connor Hayes and Amir Frenkel being put in charge of AI Products and AGI Foundations, respectively.
Scale AI’s Role
Scale AI has made significant contributions to the AI ecosystem, working with major tech companies to prepare data for training AI models. The company’s collaboration with Meta on Defense Llama, a custom version of Meta’s open-source Llama foundation model, is a notable example of its capabilities.
