Contained in the rise of Alexandr Wang and Meta’s $14 billion guess that the MIT dropout will assist deliver AI supremacy

Presiding over the confab was Alexandr Wang, the younger CEO of information labeling AI startup Scale. Wang’s firm was eight years outdated and already value $13 billion on the time, however the occasion on the Montage Deer Valley, co-hosted with longtime Scale angel investor Nat Friedman, was clearly supposed to sign Wang’s standing as extra than simply the most recent Silicon Valley wunderkind. Sitting alongside gray-haired Pentagon high brass, the 26-year-old Wang held forth on the U.S.-China AI arms race and different weighty matters. 

One attendee recalled Wang as a well-spoken grasp of ceremonies, however with an agenda to promote. “My impression is that [it] was a bit of a sales event to show off to his investors and government customers that he had a fantastic network,” he informed Fortune. One other attendee stated Wang was a “generous” host, however added he was unsettled by the “theatrical hawkishness”—what he described as a “fairly transparent effort to ingratiate himself with the national security establishment.”  

In an surprising, dramatic follow-up as attendees flew dwelling from Utah, the day after the occasion, OpenAI CEO Sam Altman was abruptly fired. Inside 48 hours, as chaos unfolded inside OpenAI’s nonprofit boardroom, Wang and Friedman have been each quietly approached to function interim CEO. Each declined. 

By then, nevertheless, it was clear: Wang, who was already recognized in some D.C. circles as Washington’s “AI whisperer,” had come a good distance since co-founding Scale AI in 2016 with Lucy Guo, again when he was a 19-year-old MIT dropout constructing a data-labeling startup for self-driving automobiles (to assist train AI techniques to know the distinction between, say, a blowing plastic bag and a pedestrian). 

In just some years, he had reworked Scale right into a generative AI powerhouse—first by hiring tens of hundreds of employees to manually sift via and label large datasets to assist prepare AI fashions, then to run mannequin evaluations and fine-tune techniques for corporations like OpenAI, SAP, and Toyota via methods like reinforcement studying. In 2021, at simply 24, he briefly grew to become the youngest self-made billionaire after a funding spherical which valued the corporate north of $7 billion. 

However when information emerged this month that Wang was becoming a member of Meta to be a part of a brand new “superintelligence” group reporting on to Mark Zuckerberg, a part of a $14.3 billion acqui-hire, business watchers have been nonetheless surprised. 

The deal, which values Scale at $29 billion and Wang’s private stake at a reported $5 billion, is Meta’s largest exterior funding ever. The stakes couldn’t be increased for Meta, because it transitions its enterprise into the rapidly-evolving AI period and races towards giants like Google and OpenAI to develop omnipotent AGI and “superintelligence” capabilities. In Wang, and within the 49% stake in Scale that Meta is buying, Zuckerberg seems to see a secret weapon. There are even rumors that Wang might be topped the pinnacle of Meta’s total AI operations—rumors which have solely added to the consternation amongst these questioning how a younger entrepreneur whose enterprise depends extra on guide labor than giant language fashions suits into Meta’s quest for AI supremacy.

Fortune spoke to greater than greater than a dozen individuals near Wang, together with present and former Scale workers, traders, acquaintances, and opponents, to hint how the 28-year-old MIT dropout constructed the enterprise on the heart of one of many richest offers within the AI growth, and to grasp why Meta is betting a lot on it. Meta declined to remark or to make Wang obtainable.

“Alex is a great recruiter, a really savvy commercial person,” stated one former Scale supervisor. “Who knows if it’ll work out? Maybe he builds a better AI team into something Herculean, maybe not, but you’re gonna bet on someone to do it. There’s probably a handful of people in the world that you bet on to do it. I think he’s probably one of them.” 

When Zuck met Alexandr

Meta’s relationship with Scale dates again to 2019, when the social media firm started utilizing Scale as an information supplier for its AI efforts. In 2024, when Scale raised $1 billion in its Sequence F funding spherical, Meta was among the many traders, scooping up half-a-million shares of the startup’s inventory.

Zuckerberg and Wang started spending extra time collectively starting in April, when Zuckerberg reached out and expressed a need to work extra intently, in accordance with a supply accustomed to the negotiations. The Meta CEO, who had as soon as additionally held the title of the world’s youngest self-made billionaire, started inviting Wang to pow-wow with him at his homes in Lake Tahoe and Palo Alto, with Zuckerberg quickly coming to belief Wang’s opinion. Advisors say that Zuckerberg would generally reference Wang’s views in conversations with them, The Data reported.

The conversations between two CEOs got here at a time when Zuckerberg was rising pissed off with Meta’s struggles maintaining with rival AI labs reminiscent of OpenAI, Anthropic, and Google DeepMind. Meta had succeeded in making a household of profitable open-source AI fashions, referred to as Llama, however by no means appeared capable of keep in entrance of the pack for lengthy. OpenAI, Anthropic, and Google DeepMind would inevitably surge previous Meta with AI fashions that captured extra consideration and mindshare amongst AI builders. 

With the discharge of Llama 4 in April 2025, Meta’s malaise grew to become a disaster. Allegations of probably inflated efficiency metrics, a rushed launch, and an absence of transparency, together with indications that Meta was failing to maintain tempo with open-source AI rivals like China’s DeepSeek, led many within the business to proclaim Meta’s newest AI mannequin a flop. (Meta has referred to as claims that it gamed efficiency metrics “simply not true,” and ascribed stories of Llama 4s “mixed performance” at launch to early bugs).

To regain the sting, Meta has moved aggressively to amass AI expertise and realign its efforts. Information stories this week have claimed Meta just lately held talks to purchase AI agency Perplexity, in addition to Protected Superintelligence, the startup based by former OpenAI chief scientist Ilya Sutskever. In response to one supply accustomed to the matter, Meta is at present in talks to accumulate the AI enterprise capital fund managed by Friedman, the Scale investor, and Protected Superintelligence government Daniel Gross. The discussions with Scale seem to have occurred in parallel to lots of Meta’s different talks. 

Wang resisted Zuckerberg’s preliminary proposal that he be a part of Meta, saying that if he have been to go away his startup, any deal must contain a right away (and worthwhile) final result for Scale’s traders, in accordance with the supply accustomed to the negotiations. All through Might, the 2 CEOs held on-and-off discussions, going from a proposed $5 billion Meta non-voting funding in Scale to the eventual association of Meta investing $14.3 billion for 49% of Scale in non-voting shares with potential future conversion. (The deal additionally features a poison tablet provision: If Wang leaves Meta, the shares would convert at a fee of 1.5, creating extra dilution, incentivizing Wang to make a long-term dedication to Meta.) 

Some sources near Wang, whose first title is spelled with out the second “e” to present it the eight characters related to luck in Chinese language tradition, stated the deal he reached with Zuckerberg exhibits his dedication to doing proper by his traders and workers moderately than abandoning them for his personal profitable exit. Nonetheless, the information that Wang was leaving got here as an enormous shock to many individuals linked to Scale and its CEO.

“It was a total shock,” stated the previous Scale AI supervisor, who left the corporate final month. “I never thought about the idea of Alex leaving Scale, especially when we’d just announced the tender offer at a $25 billion valuation. I think about how fast it all happened.”  

Scale responded to Fortune‘s request for comment by pointing to a blog post from new CEO Jason Droege that affirms the company’s continued independence, its dedication to not favoring any particular AI fashions, and hinting at upcoming bulletins.

A wonderfully timed pivot to success

After the deal was publicly introduced, Wang addressed Scale workers on the firm’s South of Market workplace in San Francisco. He obtained a standing ovation as he walked down a winding staircase to the workplace constructing’s atrium. He cried at occasions as he spoke to workers about his time at Scale and beginning the corporate when he was a freshman in school. 

Maybe Wang was considering even additional again to his childhood, because the son of immigrant dad and mom who have been nuclear physicists at Los Alamos Nationwide Laboratory in New Mexico, which had served because the top-secret web site for creating the primary atomic bombs, led by J. Robert Oppenheimer. 

“In my town, basically everybody’s parents worked for the National Lab,” he informed Fortune in an interview final yr. “Every adult around me was a scientist who had made the pledge to use their scientific capability and their powers for enhancing technologies that would ensure the continued security of the United States.” 

That upbringing offered the template Wang used to make Scale right into a profitable enterprise, stated Jared Friedman, a gaggle companion at Y Combinator. “He built an extremely talent-dense team and intense culture with people similar to him, other exceptional math and CS [computer science] students,” Friedman stated. 

Wang, who competed in nationwide math competitions in highschool, dropped out of MIT after one yr to pursue the startup dream, teaming up with Lucy Guo, a product designer at Quora, who had herself dropped out of Carnegie Mellon to pursue a Thiel Fellowship and had been Snap’s first feminine designer. The duo initially deliberate to create tech for a docs’ concierge service, however after becoming a member of startup accelerator Y Combinator in summer time of 2016, they ultimately pivoted to knowledge labelling.

“They were originally working on completely different ideas and spent most of the first summer just figuring out what to build,” recollects Friedman, who served as Wang and Guo’s companion at Y Combinator in 2016. 

As soon as it pivoted to knowledge labelling, Scale discovered the proper buyer base within the rapidly-expanding, and well-funded, group of startups working to construct self-driving automobiles. 

Wang embodied the corporate credo of “Ambition shapes reality,” stated an early worker who left in 2022.  “Alex himself would get deeply involved in customer engagements when needed, including deep-diving into both technical challenges and helping to network and negotiate with higher-ups on the business side to help us win customers and new business.”

One other supply, the previous Scale supervisor, described two-hour-long every day conferences “where we would review every single account.” The routine was not universally loved contained in the ranks, the particular person stated,  “but honestly, in retrospect it forced everyone to be very rigorous.”

Tensions between the 2 cofounders quickly surfaced as the corporate grew. Guo had recruited Wang, and she or he was the unique CEO. However the two founders couldn’t get alongside, clashing over how they every deemed their counterpart was dealing with their duties, in accordance with a supply accustomed to the matter. The board sided with Wang, who grew to become CEO, and Guo left the corporate in 2018, in accordance with this particular person’s account. Guo informed Fortune that when Wang proposed taking up the CEO position after the Sequence A, believing “he’d be better as the face of an API company,” she agreed. “I wasn’t title centric and was fine with it,” she stated in an e mail. Guo informed Fortune she had obtained $750 million because of the Meta deal, however didn’t touch upon the present state of her relationship with Wang.

In recent times, Scale has run into considerations about its labor practices with the estimated tens of hundreds of contractors it employs world wide to manually label knowledge and assessment photographs. A Division of Labor investigation was opened in 2024 and closed in Might across the firm’s adherence to the  Honest Labor Requirements Act, notably round honest pay and employee classification. There are at present two labor lawsuits towards Scale which might be ongoing. Glenn Danas, companion at Clarkson Regulation Agency—which introduced these instances towards the corporate—estimates the corporate’s contractor workforce might be roughly 60,000 individuals.

“He’s not just a salesperson”

One factor that makes the Meta/Scale deal notable is that Wang had all the time emphasised that he’s not a researcher, and that Scale AI was not constructing AI fashions. As a substitute, it wished to supply your complete generative AI ecosystem with high-quality knowledge to coach its fashions. 

“We’re not out there developing a leading large language model,” Wang informed Fortune final yr. “But we do serve the entire ecosystem. Nearly every major large language model is built on top of our data foundry.”

Scale was additionally agnostic when it got here to working with prospects. It did a few of the earliest experiments on reinforcement studying human suggestions (RLHF), with OpenAI in 2019, with the group that later grew to become Anthropic. Scale continued collaborating with each AI startups. “We’re both neutral across the entire ecosystem and we’re able to have very strong relations with every relevant company in the AI ecosystem across the stack,” Wang stated.

Scale has stated it would proceed to function as an impartial firm (with Wang as chairman), serving different prospects. Below the phrases of the deal, Meta will spend a minimal of $500 million a yr for Scale knowledge over the following 5 years, in accordance with the supply accustomed to the negotiations. However the notion of neutrality now appears all however useless. Following the announcement, information stories stated that each Google and OpenAI have been planning to finish their relationship with Scale. Some business observers speculate that Meta’s actual technique all alongside was an information landgrab, a transfer to safe a serious supply of one of many important parts for constructing AI fashions—and to deprive others of it.

However a number of business insiders that Fortune spoke to have been skeptical of the speculation. Ryan Kolln, CEO of Scale AI competitor Appen, stated he doubts the Meta/Scale deal is about consolidating knowledge distributors or ravenous opponents in search of knowledge. There’s a danger in doing that as a result of there’s a powerful profit to having variety in knowledge, with distributors which have completely different specialties and experience, he stated.

So what’s the key factor Zuckerberg is getting for his $14.3 billion? 

A number of sources near the businesses stated they’d heard that Wang is being thought-about as a possible chief for Meta’s total AI group—a much more {powerful} remit than the “superintelligence” group, which some information stories have stated will consist of fifty individuals and be helmed by Wang.

Erik Meijer, a former engineering chief at Meta, stated he wouldn’t be stunned by a transfer to make Wang a “chief AI officer” of all of Meta. “Heaping everything into a single org makes sense,” he stated. “In fact I would be surprised if Mark [Zuckerberg] would make such a big investment and then not do a full on reorg putting all AI efforts in one place.” 

Meta’s sprawling AI kingdom consists of the product-focused generative AI group, the AGI Foundations unit targeted on additional Llama growth, in addition to FAIR (Basic AI Analysis), which was based by Yann LeCun, the AI “godfather” who stays Meta’s chief scientist. There’s additionally a standalone Enterprise AI product group helmed by former Salesforce AI head Clara Shih. 

That stated, Wang can be an unorthodox selection for the highest position, given that he’s not a pc scientist. Whether or not the PhDs and different AI researchers working at Meta would settle for Wang as their chief is hardly a certain factor.  “Nope,” one present Meta AI researcher stated flatly. Wang is a businessman with out a robust file working with AI fashions, the Meta researcher stated. A former Meta AI researcher who labored in Meta’s FAIR group concurred: “He is not going to be accepted easily.”

It’s a warning Zuckerberg could effectively heed, on condition that Meta’s analysis lab is already bleeding expertise—11 of the unique 14 Llama authors have left to hitch opponents. Alternatively, Wang’s defenders level out that whereas not a pc scientist, he’s greater than able to getting within the AI weeds.

“We forget sometimes he is a very technically-capable guy,” stated the previous Scale supervisor. “He’s not just a salesperson. He’s incredible at it, but he’s not just a salesperson.”

Navigating an unpredictable platform shift

With greater than $164 billion in annual income, Meta is aware of all too effectively that it takes one thing actually distinctive to maneuver the needle in its enterprise. And in paying up for Wang and Scale, Zuckerberg is probably going betting that the actual worth transcends any easy classes.

One supply near Wang informed Fortune that the shock and confusion stems from the truth that Wang doesn’t match into the standard tech world archetypes. “Silicon Valley is good at putting people into boxes, they like to say, this person is a technical person, this person is a business person,” he stated. “Alex is truly a man of one.” And that type of asset is very precious because the panorama adjustments.

If AI proves as game-changing as some count on, it will likely be way more consequential than any of the earlier platform shifts which have rocked the tech business, bringing hard-to-predict dangers and alternatives. The appearance of AI is already thawing the large navy contract market that Silicon Valley corporations have been as soon as largely frozen out of, with Meta forging ties with drone-maker Anduril whereas rivals like OpenAI clinch Pentagon offers of their very own.

“My very, very deep sense is that Meta is actively exploring, maybe even advanced in terms of actively exploring, wanting to play a significant leadership role in the national security of the United States,” stated one former Division of Protection official. 

As Wang demonstrated on the Utah confab in 2023, and in Scale’s full-page Washington Put up advert in January (“Dear President Trump, America must win the AI War”), Meta’s new funding is well-positioned on that entrance. It’s additionally not gone unnoticed that Michael Kratsios, the Trump Administration’s director of the Workplace of Science and Expertise Coverage and the Science Advisor to the President, labored at Scale in between the 2 Trump phrases. 

“He’s been very smart and extremely clever,” the previous DoD official stated about Wang. “He seemed to lean into something that a lot of people have a little bit of a revulsion against, which is, engage in the politics of Washington. I think Alex, whether it’s by generation or personality, or whatever, he really got that that needed to happen – he seemed to have a real sixth sense.” 

However whereas Meta may use all the assistance it could actually get in D.C. (“No one loves to hate anyone more than Washington loves to hate Zuckerberg; it’s kind of a pastime for some people,” a beltway insider stated), Wang will finally must ship greater than the providers of a lobbyist for the partnership with Zuckerberg to achieve success. To Wang’s followers, together with one supply who has recognized Wang for a couple of decade, his versatility will assist Meta open doorways and navigate no matter challenges lie forward: “He’s better at the point of contact on any problem more than anyone I’ve ever seen.” 

Zoom out for a long term view, and this particular person echoed a standard sentiment, that Wang is simply getting began. “He may start another company, or maybe a bunch of companies,” the particular person stated. “Over time, he has a chance of being a main character in Silicon Valley at the highest levels for the next 30 years.”