Factbox-Meta's Scale AI stake buyout spotlights other major deals amid regulatory risks
(Reuters) -Meta has finalized a $14.3 billion purchase of a 49% stake in data labeling startup Scale AI, according to sources familiar with the matter.
Scale AI said late on Thursday that the deal would value it at $29 billion and that the startup's chief executive, Alexandr Wang, would join Meta to head a new team focused on artificial general intelligence, the latest twist in Silicon Valley's race toward the cutting-edge technology.
Founded in 2004 by CEO Mark Zuckerberg and his fellow Harvard University students and originally called "TheFacebook", the company dropped "The" from its name after securing the Facebook.com domain in 2005. It rebranded as Meta Platforms in 2021.
The Scale AI deal comes when Meta, which has a market value of $1.77 trillion, contends with antitrust scrutiny surrounding its acquisitions of WhatsApp and Instagram.
Here are Meta's major deals over the years:
Target Deal Value Announced Closed Scope
WhatsApp $19 February October Mobile messaging platform
billion 2014 2014 acquired in a cash and stock
deal.
Scale AI $14.3 June 2025 Deal could help Meta have access
billion to the high-quality data labeling
(sources that's increasingly gaining
say) significance.
Oculus VR $2 billion March Same year Maker of virtual-reality glasses
2014 for gaming in fast-growing
wearable devices space.
Instagram $1 billion April Same year Mobile photo- and video-sharing
2012 platform acquired in a cash and
stock deal.
Kustomer $1 billion November February Customer relationship management
(reported 2020 2022 platform, which raised $60
by The million in financing in 2023 amid
Informatio spin-out from Meta.
n)
CTRL‑Labs Between September Same year New York-based startup
$500 2019 specializing in non-invasive
million neural interface technology.
and $1
billion
(reported
by CNBC)
LiveRail $400 July 2014 Same year San Francisco-based video and
million to advertising company.
$500
million
(reported
by
TechCrunch
)
Giphy $400 May 2020 Unable to Meta faced regulatory scrutiny
million close from UK's Competition and Markets
Authority. In May 2023, it
decided to sell Giphy to
Shutterstock for $53 million.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bloomberg
23 minutes ago
- Bloomberg
Meta's $14.3B Scale Investment, Apple's New Siri Launch
Bloomberg's Caroline Hyde breaks down Meta's plans to take a 49% stake in Scale AI and hire the startup's CEO, Alexandr Wang. Plus, the CEO of stablecoin network Circle discusses how the passing of the GENIUS Act could impact the payments space. And Apple targets the spring of 2026 for the launch of its revamped voice assistant Siri, as the iPhone maker plays catch-up in the AI race. (Source: Bloomberg)
Bloomberg
26 minutes ago
- Bloomberg
23andMe Co-Founder Wins Auction for Genetic Data
The co-founder of bankrupt genetic analysis company 23andMe won an auction for the firm's assets, agreeing, along with a California research institute, to pay $305 million for a cache of customer DNA data Anne Wojcicki and nonprofit TTAM Research Institute offered nearly $50 million more than the last bid from Regeneron Pharmaceuticals, which was named as the backup bidder. Should Wojcicki and TTAM fail to close the sale, which must be approved by a federal judge, Regeneron would get the assets instead.
Forbes
26 minutes ago
- Forbes
Meta Could Spend Majority Of AI Budget On Scale As Part Of $14 Billion Deal
Alexandr Wang will step down as Scale AI to join Meta and lead a new AI lab. Last night, Scale AI announced that Meta would acquire a 49 percent stake in it for $14.3 billion — a seismic move to support Meta's sprawling AI agenda. But there's more to the agreement for Scale than a major cash infusion and partnership. Forbes has learned that Meta intends to pay Scale at least $450 million a year for five years for its AI products, or more than half of its annual AI spend, whichever is less, according to a person who worked on the deal. Scale AI declined to comment. Meta didn't respond to a comment request. That commitment from Meta would make up a major part of Scale's revenue. Last year, Scale generated $870 million in revenue, largely driven by demand for its data labelling services. This year, the company expected to generate $2 billion in revenue, Bloomberg previously reported. But on Thursday, Forbes first reported Thursday that OpenAI, which still has contracts with Scale, had been winding down its spend on the company's services in recent months as it searched for new partners better suited to its needs (Scale denied the claim). The agreement with Meta could help Scale fill a potential revenue hole should OpenAI or customers like Anthropic and Microsoft consider revising their contracts with the company or allowing them to expire now that it had such close ties with a major competitor. Alexandr Wang, Scale's cofounder and CEO, and one of the world's youngest billionaires at age 28, is set to join Meta to lead its AI lab, where he will lead an effort to develop a so-called superintelligence, an AI system that outperforms human capabilities. The Meta deal is a major and unexpected turning point for Scale, which Wang has led since its founding in 2016. During his tenure, Scale built an army of clickworkers to train AI data models, which proved an essential tool for AI giants building LLMs and other applications. More recently, Wang led Scale's foray into national security, landing a series of contracts with the Pentagon to help the military implement AI models and use the technology for training and planning. Now, under new CEO Jason Droege, who launched Uber Eats, and previously was an executive at law enforcement technology company Axon, Scale — which some had hoped might be a 2025 IPO candidate — has tethered its future and founder to Meta's AI ambitions.
