Billion-dollar job offers, licensing deals instead of acquisitions, and the aggressive recruitment of top researchers shape the battle for AI talent. Microsoft, Alphabet, Meta, and Amazon are increasingly relying on "reverse acquihires" – an approach where the founders and core teams are poached instead of acquiring the startup itself. This means quick, uncomplicated access to know-how and technology for the corporations – without regulatory hurdles.
A prominent example is Microsoft's deal with Inflection AI: The company paid $650 million for a license and brought in co-founder Mustafa Suleyman to manage the copilot business. Meta, in turn, secured key people from Scale AI through an investment agreement worth billions. Google also made a move – at the startup Windsurf, whose acquisition by OpenAI was already prepared, but was ultimately thwarted by a $2.4 billion deal from Alphabet. Left behind were disappointed employees who missed out on their hoped-for exit.
For the tech giants, the approach is efficient. They secure crucial expertise in the ongoing AI race, avoid complex integrations, and bypass antitrust reviews. For many founders and top researchers, the offers are simply too lucrative: Individual compensation packages reach amounts otherwise reserved for top athletes.
But the downside is severe. Venture capitalists are left without the hoped-for multipliers, employees lose access to potential equity gains, and the cultural foundation of Silicon Valley is shaken. Traditionally, the model was based on many failing, few creating enormous value through exits — and this mechanism fueled risk-taking. If startups are systematically hollowed out without broad workforces benefiting, trust threatens to wane.
Investors like Jon Sakoda warn against a break with the implicit "startup bargain": Those who in the future assume that their share will remain practically worthless are more likely to join Big Tech directly—secure, but without the dynamism that made the ecosystem unique for decades. Ironically, Microsoft, Meta, Amazon, and Alphabet could thereby dry up their own innovation pipeline in the long run.
