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Microsoft hires Inflection founders to run new consumer AI division

Microsoft has hired Mustafa Suleyman and Karén Simonyan, co-founders of high-profile AI startup Inflection AI, and several of their colleagues in one of the strangest deals as the Satya Nadella-led cloud giant continues its aggressive push to attract top talent.

Suleyman -- also a co-founder of DeepMind, which Google bought in 2014 to bolster its own AI efforts -- will run Microsoft's newly formed consumer AI unit, called Microsoft AI, whereas Simonyan is joining the company as a chief scientist in the same new group. Mustafa, whose official title at Microsoft is EVP and CEO of Microsoft AI, will report to chief executive Nadella.

Microsoft is expected to highlight its latest AI advances for consumers in an event focused on Microsoft Copilot, Windows and Surface on Thursday.

Inflection AI is no stranger to Microsoft. The cloud giant led a $1.3 billion funding round in the startup less than a year ago. At the time of the funding, Inflection AI said it is building the world's largest AI cluster, featuring 22,000 Nvidia H100 GPUs.

Suleyman will also lead AI products and research for Copilot, Bing and Edge, he wrote in a tweet.

"Several members of the Inflection team have chosen to join Mustafa and Karen at Microsoft," Nadella wrote in a blog post. "They include some of the most accomplished AI engineers, researchers, and builders in the world. They have designed, led, launched, and co-authored many of the most important contributions in advancing AI over the last five years."

Inflection AI is one of the most prominent AI startups. It was founded in 2022 by LinkedIn co-founder Reid Hoffman and Suleyman, and had sought to develop AI systems that can engage in open-ended dialogue, answer questions and assist with a variety of tasks.

Hoffman said all investors in Inflection AI "will have a good outcome today, and I anticipate good future upside." Sean White, co-founder of Braingels, will be taking over as the chief executive of Inflection AI, Hoffman said.

In a blog post, Inflection AI said that it will shift its focus to the AI studio business, where it builds and tests customer generative AI models. "This renewed emphasis on our API also comes with some important changes in the company," wrote Inflection AI.

As part of the transition/situation, Inflection AI said it will host Inflection-2.5 on Microsoft Azure, something it said will help to reach "creators everywhere." It added: "We'll also be ensuring it comes to other cloud hosting platforms in the near future. The API itself isn't available today, but will be up and running very soon."

Microsoft appears to have been working on the new AI unit for some time. Nadella had offered to hire OpenAI co-founders Sam Altman and Greg Brockman -- when they temporarily exited the startup in December.

Nadella said today the firm — and the world — is only in its second year of the AI platform shift and Microsoft “must ensure we have the capability and capacity to boldly innovate.”