Microsoft will pay Inflection AI about $650 million for a license to use software in the field of AI

Microsoft will pay Inflection AI about $650 million for a license to use software in the field of AI

Microsoft agreed to pay $650 million to startup Inflection AI for licenses for its developments in the field of artificial intelligence. The company also plans to hire most of Inflection AI’s employees, Bloomberg reports.

On March 20, Microsoft announced that it had hired Inflection AI co-founders Mustafa Suleiman and Karen Simonyan. They will work in Microsoft’s AI division, which will develop Copilot, Edge and Bing. Most of Inflection’s 70 employees will also join Microsoft.

According to sources at Bloomberg, Inflection AI is now trying to “offload some of its computing power or access power that can be used for tasks like training AI models.” Sources also said the startup is seeking partial reimbursement from CoreWeave, the company’s cloud computing partner. It is assumed that these measures will help reduce the costs of creating AI models against the background of the company’s transition to a corporate business model.

As part of the deal, Microsoft will pay $620 million for licenses to the AI ​​models developed by Inflection, and about $30 million to waive claims to hire a large number of employees, Bloomberg’s interlocutor said.

Inflection AI was valued at $4 billion in 2023 after raising $1.3 billion in funding. Last year, the startup introduced its chatbot called Pi, but the company failed to find a successful business model for the product.

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