Microsoft has finalized a $650 million cash deal with AI startup Inflection, allowing the tech giant to utilize Inflection’s AI models and onboard a majority of its team, including co-founders Mustafa Suleyman and Karen Simonyan, for Microsoft’s newly formed consumer AI division.
This agreement, which also sees the Inflection models integrated into Microsoft’s Azure cloud service, serves dual purposes: compensating Inflection’s investors, including Greylock and Dragoneer, and bolstering Microsoft’s AI capabilities in consumer products.
Suleyman assumes the role of CEO, and Simonyan becomes the chief scientist of the unit, with other key Inflection personnel joining Microsoft. This move, part of Microsoft’s strategy to enhance its AI offerings, may attract regulatory attention due to the company’s growing AI investments.
