Elon Musk’s artificial intelligence company xAI is experiencing significant leadership upheaval in the wake of its merger with SpaceX, with two additional co-founders announcing their departures within days of the $1.25 trillion deal.
Co-Founders Exit Following Restructuring
Jimmy Ba and Tony Wu, both co-founders who led critical research and reasoning efforts at xAI, have left the company, marking a dramatic turning point for the three-year-old AI startup. Ba, who oversaw research and safety, announced his departure via X with thanks to Musk, while Wu’s exit followed just hours later. Their departures come as xAI announced a comprehensive restructuring reorganizing the company into four core teams focused on the Grok chatbot, coding systems, video generation, and computer simulation projects.
Half of Founding Team Gone
The latest exits represent a significant loss of institutional knowledge, with half of xAI’s original 12-member founding team now departed. Prior departures included Kyle Kosic, who left for OpenAI in mid-2024; Christian Szegedy, a former Google engineer who departed last February; Igor Babuschkin, who launched a venture capital firm last August; and Greg Yang, who left last month citing health reasons. Several other technical staff members have also announced exits in recent weeks.
Musk Justifies Restructuring
During a 45-minute all-hands meeting, Musk characterized the departures as necessary consequences of xAI’s rapid growth. “The company must evolve its structure as it grows quickly, which unfortunately required separation from some employees,” he stated, adding that xAI was “aggressively” hiring to fill gaps.
IPO Timeline at Risk
The exodus raises concerns about the merged SpaceX-xAI entity’s planned public offering. Musk reportedly intends to take the combined company public as early as June, but the wave of departures could spook potential investors. The restructuring also comes amid regulatory investigations in Europe, Asia, and the United States over Grok’s facilitation of non-consensual explicit content.
Underlying Tensions
While the exact reasons for departures remain unclear, reports indicate internal tensions over product development pace and technical demands as xAI faces intense competition in AI chatbots and coding tools. The merger itself, intended to support Musk’s ambitious vision of launching a network of satellite-based data centers for AI computations, appears to have accelerated organizational changes that have destabilized the company’s leadership structure just as it prepares for public markets.