Hustler Words – Meta’s June investment of $14.3 billion in Scale AI, bringing CEO Alexandr Wang and key executives to helm Meta Superintelligence Labs (MSL), is already showing cracks. Just two months after joining Meta, Ruben Mayer, Scale AI’s former Senior Vice President of GenAI Product and Operations, has departed. This follows reports from hustlerwords.com that MSL’s core unit, TBD Labs, is bypassing Scale AI, opting for competitors Mercor and Surge for data training, despite the massive investment.
Sources within TBD Labs reportedly cite concerns over the quality of Scale AI’s data, preferring the offerings of Surge and Mercor. While AI labs often collaborate with multiple vendors—and Meta previously worked with Mercor and Surge—the scale of Meta’s investment in Scale AI makes this situation unusual. Scale AI’s initial crowdsourcing model, relying on low-cost labor for data annotation, has proven less effective for the sophisticated AI models of today, which demand highly skilled experts. While Scale AI has attempted to adapt with its Outlier platform, competitors like Surge and Mercor, built on a foundation of high-skilled talent, have gained a significant advantage.
A Meta spokesperson denied claims of data quality issues with Scale AI’s product. However, the shift toward competing vendors suggests a lack of complete reliance on Scale AI, even after the substantial investment. This contrasts sharply with Scale AI’s situation; following Meta’s investment, OpenAI and Google reportedly ceased their collaborations, leading to a July layoff of 200 employees in Scale AI’s data labeling division.
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The strategic rationale behind Meta’s investment is also being questioned. While some speculated the investment was primarily to attract Wang and his team, the integration hasn’t been seamless. Several Scale executives brought to Meta aren’t working on the core TBD Labs team, and Meta isn’t solely dependent on Scale AI for data. Furthermore, internal tensions within MSL have reportedly increased since Wang’s arrival, with new hires expressing frustration with Meta’s bureaucracy and existing team members facing reduced roles.
The exodus of talent is significant. Reports from Wired indicate that some OpenAI recruits have already left Meta. This follows the departures of MSL AI researcher Rishabh Agarwal, Director of product management Chaya Nayak, and research engineer Rohan Varma. These departures, coupled with the reported frustration of Zuckerberg following the underwhelming launch of Llama 4, paint a picture of an AI division struggling to find its footing. Zuckerberg’s aggressive recruitment drive, including securing top talent from OpenAI, Google DeepMind, and Anthropic, and acquisitions of AI startups, appears to be facing significant challenges.
The situation highlights the risks of large-scale investments in AI, especially when relying on a single vendor. Meta’s billion-dollar bet on Scale AI may be proving to be a costly gamble, raising questions about the future stability and success of its AI ambitions. The upcoming launch of MSL’s next-generation AI model, reportedly slated for the end of the year, will be a critical test of whether Meta can overcome these internal challenges.
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