Latest news with #JasonDroege
Yahoo
18-07-2025
- Business
- Yahoo
Scale AI reduces workforce following Meta investment
Scale AI, a San Francisco-based data-labelling and technology company, has implemented a significant reduction in its workforce following a multi-billion-dollar investment by Meta. The company confirmed the layoff of 200 employees, which accounts for 14% of its staff. Additionally, it plans to terminate contracts with 500 global contractors. This development comes in the wake of Meta's acquisition of a 49% stake in Scale AI for $14.3bn, as reported by Bloomberg. Interim CEO Jason Droege communicated the restructuring plans to employees, citing the need to address inefficiencies resulting from rapid expansion. In an internal email to staff, Droege stated that the company had expanded its GenAI capacity too rapidly over the past year. This re-evaluation was prompted by shifts in market demand that necessitated a refined operational strategy. The restructuring targets Scale AI's GenAI division, which is involved in managing projects such as AI chatbots like xAI's Grok and Google's Gemini. According to the email, affected employees have been advised against reporting to the office during this transition period. The company has ensured that departing staff will receive appropriate severance packages. As part of the broader organisational changes, several high-ranking officials, including vice presidents and chiefs of staff, have exited the company following Meta's investment. Despite these shifts, Scale AI claims to maintain a strong financial position and plans to expand its workforce in enterprise and public sector roles later this year. Meta's move to acquire a near-majority stake, albeit without voting rights, in Scale AI is aimed at enhancing its competitive edge against entities like OpenAI. Former Scale AI CEO Alexandr Wang has transitioned to the role of chief AI officer at Meta and continues to serve on Scale AI's board of directors. Meta is concurrently establishing Meta Superintelligence Labs as part of this collaboration. Scale AI's business model focuses on providing labelled datasets essential for training machine learning models. Its clientele includes major organisations such as Google, OpenAI, and Anthropic. Recently, Scale AI secured a multi-million-dollar contract with the US Department of Defense, underscoring its role in delivering data solutions for military applications. "Scale AI reduces workforce following Meta investment" was originally created and published by Verdict, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
San Francisco Chronicle
18-07-2025
- Business
- San Francisco Chronicle
San Francisco AI company lays off 200 after Meta's multibillion-dollar deal
Just weeks after Meta invested $14.3 billion into Scale AI and tapped its founder, Alexandr Wang, to lead its new artificial intelligence initiative, the data-labeling startup is cutting roughly 200 full-time employees — about 14% of its staff — and parting ways with 500 contractors worldwide. The cuts, announced in a company-wide memo on Wednesday by interim CEO Jason Droege, mark a dramatic shift for the once high-flying San Francisco startup, which has played a critical role in preparing data for major AI players including OpenAI, Google and Microsoft. 'The reasons for these changes are straightforward: we ramped up our GenAI capacity too quickly over the past year,' Droege wrote in the memo obtained by multiple media outlets. 'While that felt like the right decision at the time, it's clear this approach created inefficiencies and redundancies. We created too many layers, excessive bureaucracy, and unhelpful confusion about the team's mission.' Scale AI's generative AI division — the unit at the heart of the layoffs — is being reorganized from 16 pods into five focused teams: code, languages, experts, experimental and audio. The company's go-to-market team will also be consolidated into a single 'demand generation' group. The company emphasized that it remains well-funded and is preparing to 'significantly increase headcount' in enterprise and government-facing business units later this year. The layoffs follow an industry-wide reckoning over shifting partnerships. A spokesperson for the company said affected employees have been provided severance, with full-time roles paid through mid-September.
Time of India
17-07-2025
- Business
- Time of India
ScaleAI that lost its CEO to Mark Zuckerberg's Meta announces layoffs, cuts ties with some of its biggest customers; read memo to staff
ScaleAI, the artificial intelligence startup has announced significant layoffs weeks after Meta's $14.3 billion investment and departure of CEO Alexandr Wang, who is now leading Meta's Superintelligence Labs. The company has announced that the layoffs are part of strategic restructuring and will affect the employees of the Generative AI division . In a memo to the employees, the company has confirmed that it is laying off 200 full-time employees which accounts to 14% of its workforce. Along with this, it also has to let go of 500 global contractors. 'We ramped up our GenAI capacity too quickly,' CEO Jason Droege wrote. 'It created too many layers, excessive bureaucracy, and confusion about the team's mission'. ScaleAI layoffs: Read what CEO Jason Droege said in a memo to employees In a memo to the employees, CEO Jason Droege confirmed the layoffs. The company has revealed that the Generative AI division is reduced from 16 pods to 5. The affected employees were locked out of systems and slack channels before receiving severance details. Here is the full email from Scale AI's CEO Jason Droege to Scale AI's GenAI employees: Hi team, by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like An engineer reveals: One simple trick to get internet without a subscription Techno Mag Learn More Undo After reviewing our company and its operations, I've made the decision to restructure several parts of the GenAI organization. I believe these changes will best position us for the long-term, make the org more efficient, and allow GenAI to focus on the biggest and most profitable opportunities. As a result of this restructuring, some members of this org will be leaving Scale today. To ensure a smooth process and give people the necessary space, please do not come into the office. All impacted FTEs will receive an email to their personal email address by 8am PT and badge and IT access will be removed. For those not impacted, I will share more details later this morning on the restructuring and our path forward. I know news like this is tough, but please know how grateful I am for the work this team has done. Whether you're directly affected by these changes or not, every one of you has helped build Scale into the company it is today and the accomplishments it has made. Thank you again. Despite the layoffs the company insists it remains well-funded and plans to hire hundreds in the second half of 2025, targeting enterprise, public sector, and international markets. AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
17-07-2025
- Business
- Time of India
$14 billion Meta deal, then massive layoffs? Scale AI cuts 200 roles, 14% of its workforce in stunning move
Just weeks after closing a $14 billion deal with Meta, Scale AI has abruptly laid off 200 full-time employees, which is 14% of its 1,400-person workforce, along with 500 contractors, as the company is 'restructuring' its GenAI group, sparking concerns about the startup's direction and stability, as per a report. Scale AI's GenAI Group Hit Hard as Company 'Restructures' The layoffs were announced through an email from interim CEO Jason Droege, as reported by Business Insider. The message informed staff that the company was restructuring its Generative AI division, an essential part of Scale that supports high-profile clients like Elon Musk's xAI (the maker of Grok) and Google's Gemini chatbot, according to the report. Explore courses from Top Institutes in Select a Course Category Project Management Management Design Thinking Digital Marketing Operations Management Product Management Finance Data Science Data Science PGDM others Public Policy MBA Technology CXO healthcare Leadership Others Healthcare Data Analytics MCA Cybersecurity Degree Artificial Intelligence Skills you'll gain: Portfolio Management Project Planning & Risk Analysis Strategic Project/Portfolio Selection Adaptive & Agile Project Management Duration: 6 Months IIT Delhi Certificate Programme in Project Management Starts on May 30, 2024 Get Details Skills you'll gain: Project Planning & Governance Agile Software Development Practices Project Management Tools & Software Techniques Scrum Framework Duration: 12 Weeks Indian School of Business Certificate Programme in IT Project Management Starts on Jun 20, 2024 Get Details The sudden move left some employees locked out of their systems and removed from Slack channels before they even woke up, as per Business Insider. ALSO READ: Tomorrowland fire shock: Main stage engulfed in flames days before start of massive festival - what we know The email mentioned that, "As a result of this restructuring, some members of this org will be leaving Scale today," adding, "To ensure a smooth process and give people the necessary space, please do not come into the office," as quoted in the Business Insider report. Live Events According to a separate email to the affected employees obtained by Business Insider, the laid-off ScaleAI employees are expected to be paid as normal through September 15 and then receive a minimum of four weeks of additional pay if they sign the company's severance agreement, reported Business Insider. Meta's Investment Raises Concerns The workforce reduction comes after Meta's massive investment into Scale, a deal that included hiring the company's co-founder and former CEO, Alexandr Wang, to lead Meta's new Superintelligence division, according to the Business Insider report. Meta also took a significant equity stake in the startup, reportedly approaching half of the company, as per Business Insider. ALSO READ: Crisis-driven rally? Bitcoin and Gold soar as inflation looms and political heat rises Key Leaders Exit as Clients Pause Projects In the weeks following that deal, several key leaders at Scale have departed, including multiple VPs, chiefs of staff, and top AI researchers, according to the report. At the same time, major clients like Google have reportedly paused projects, stoking speculation about the company's internal dynamics and long-term viability, as per the Business Insider report. The startup is also facing challenges around the security practices of its training documents, according to the report. Scale AI Promises Future Growth in Other Divisions However, the firm told Business Insider that Scale remains well-funded and is committed to growth and hiring hundreds more employees in different sectors, as per the report. Scale AI spokesperson Joe Osborne said, "We're streamlining our data business to help us move faster and deliver even better data solutions to our GenAI customers," and added that, "We also plan to make significant investments and hiring across our enterprise and government AI businesses," as quoted in the report. Scale AI CEO's Email to Staff Business Insider has shared the full email from Scale AI's CEO Jason Droege to Scale AI's GenAI employees, below: Hi team, After reviewing our company and its operations, I've made the decision to restructure several parts of the GenAI organization. I believe these changes will best position us for the long-term, make the org more efficient, and allow GenAI to focus on the biggest and most profitable opportunities. As a result of this restructuring, some members of this org will be leaving Scale today. To ensure a smooth process and give people the necessary space, please do not come into the office. All impacted FTEs will receive an email to their personal email address by 8am PT and badge and IT access will be removed. For those not impacted, I will share more details later this morning on the restructuring and our path forward. I know news like this is tough, but please know how grateful I am for the work this team has done. Whether you're directly affected by these changes or not, every one of you has helped build Scale into the company it is today and the accomplishments it has made. Thank you again. FAQs Is Scale AI going out of business? No. The company says it's still well-funded and is shifting focus to more sustainable growth in other sectors like enterprise and government AI. What's happening with Scale's clients? Some major clients, like Google, have reportedly paused projects with Scale since the Meta deal . This has sparked questions about long-term relationships.
Independent Singapore
17-07-2025
- Business
- Independent Singapore
Scale AI cuts 200 full-time staff weeks after Meta's US$14.3B investment and founder Alexandr Wang's exit
Photo: Instagram/alexanddeer INTERNATIONAL: Just weeks after securing a US$14.3 billion (S$18.39 billion) investment from Meta and seeing its founder, Alexandr Wang, move over to the tech giant, artificial intelligence startup Scale AI has announced it is laying off 14% or 200 of its full-time employees, CNBC reported. In an internal memo to staff on Wednesday, interim CEO Jason Droege said the company expanded its generative AI operations 'too quickly,' which resulted in many layers of 'excessive bureaucracy.' In the memo viewed by CNBC , it said, 'These changes will make us more nimble, enabling us to react more quickly to shifts in the market and customer needs. This structure will allow us to better serve the customers we have today and win back customers that have slowed down work with us.' 'I want to extend our deepest gratitude for their valuable contributions and dedication to our company,' it added. Despite the job cuts, Mr Droege said Scale AI is still in a strong financial position and plans to hire more staff in the second half of the year across its application business units, including its enterprise and public sector as well as international public sector divisions. The job cuts were first reported by Bloomberg . Scale AI spokesperson Joe Osborne said the company will also be ending work with 500 contractors worldwide. Before the layoffs, the company had 1,400 employees worldwide. Mr Osborne said those laid off have been provided severance. He said that the company has been streamlining the business to move faster and deliver even better data solutions to GenAI customers. 'We also plan to make significant investments and hiring across our enterprise and government AI businesses,' he added. Scale AI was founded in 2016 and helps tech companies prepare data to train artificial intelligence models. It has worked with major firms like OpenAI, Microsoft and Google. However, Reuters reported that OpenAI has been cutting back its use of Scale AI's services over the past year, while Google is reportedly cutting ties with the company following its deal with Meta. Earlier this month, Bloomberg also reported that Apple's top executive, Ruoming Pang, was leaving the company to join Meta's new superintelligence team. /TISG Read also: Nvidia becomes first company to hit US$4 trillion valuation amid AI boom () => { const trigger = if ('IntersectionObserver' in window && trigger) { const observer = new IntersectionObserver((entries, observer) => { => { if ( { lazyLoader(); // You should define lazyLoader() elsewhere or inline here // Run once } }); }, { rootMargin: '800px', threshold: 0.1 }); } else { // Fallback setTimeout(lazyLoader, 3000); } });
