Ex-OpenAI, DeepMind staffers set for US$1 billion value in Andreessen-led round
The agreement values Periodic Labs at US$1 billion before the investment, an impressive price for a months-old company, according to the people, who asked not to be identified because the information is private.
OpenAI had previously agreed to lead the investment, but Periodic Labs decided that Andreessen Horowitz could offer more resources, one of the people said. OpenAI is still expected to participate in the financing and potentially team up with the company, the person said. The round hasn't closed, and terms of the deal could change.
Andreessen Horowitz didn't respond to a request for comment. Spokespeople for Periodic Labs and OpenAI declined to comment.
Periodic Labs was founded by Liam Fedus, OpenAI's former vice-president of research and a key member of the team that launched ChatGPT, and Ekin Dogus Cubuk, a former research scientist at Google's DeepMind AI division. The idea is to use AI to study materials and potentially discover new ones.
The Information earlier reported some details of Periodic Labs' fundraising plans.
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Little has been shared about the new venture. In a March tweet announcing his departure from OpenAI, Fedus said he was excited about AI for science. He called it 'one of the most strategically important areas' for OpenAI and said the company planned to 'invest in and partner' with Periodic Labs.
Fedus is part of a growing group of former OpenAI staffers launching their own ventures, a cadre that's drawn comparisons to the 'PayPal mafia', a group of prolific entrepreneurs including Elon Musk and Peter Thiel. Anthropic, the OpenAI rival, was started by ex-OpenAI executives Dario and Daniela Amodei. Thinking Machines Lab, recently valued at US$10 billion, was founded by former OpenAI executive Mira Murati.
Investors are jostling for stakes in startups launched by alumni of OpenAI and other AI pioneers and are willing to pay lofty prices for what they see as rare talent. At the same time, larger companies are trying to retain employees with massive compensation packages worth hundreds of millions.
Several other OpenAI employees – including Rhythm Garg, Linden Li and Yash Patil – recently exited the company to launch a startup called Applied Compute. The startup quickly raised funding from Benchmark, Bloomberg reported.
Benchmark's investment valued Applied Compute at US$100 million, Upstarts Media reported. That's still remarkably high for such an early-stage deal, though it pales in comparison with the valuation that Periodic Labs commanded – thanks to Fedus' central role in creating ChatGPT. BLOOMBERG
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