Elon Musk's xAI Loses More Co-Founders, Original Team of 12 Down to 6
In a significant blow to Elon Musk's artificial intelligence venture, xAI, co-founders Jimmy Ba and Tony Wu have resigned from the company. This development whittles the startup's original team of 12 founders down to just six, highlighting ongoing challenges within the firm. The exits come amid reports of financial crunch and discord over the company's strategic direction, raising questions about xAI's stability and future prospects.
Why Did Jimmy Ba and Tony Wu Resign from xAI?
Jimmy Ba announced his departure on 11 February via a post on Musk's social media platform X, formerly Twitter, expressing gratitude for the opportunity to co-found xAI. He praised the company's mission to "push humanity up the Kardashev tech tree" and thanked Elon Musk for assembling the team. Ba stated, "So proud of what the xAI team has done and will continue to stay close as a friend of the team. Thank you all for the grind together. The people and camaraderie are the real treasures at this place." He added that it was "time to recalibrate my gradient on the big picture," hinting at personal reasons for leaving.
Tony Wu followed suit, posting his resignation on 10 February, describing xAI as a "family" that "will stay with me forever." He reflected on the camaraderie and battles fought with the team, saying, "I will deeply miss the people, the warrooms, and all those battles we have fought together. It's time for my next chapter. It is an era with full possibilities: a small team armed with AIs can move mountains and redefine what's possible." Wu also thanked Musk for "believing in the mission and for the ride of a lifetime." Both Ba and Wu are alumni of the University of Toronto, with Wu having previously worked at Alphabet Inc.'s Google, according to Bloomberg reports.
Signs of a Sinking Ship? Is Elon Musk's xAI in Crisis?
The resignations of Ba and Wu mark the fifth and sixth departures from xAI's founding group over the past two years. Earlier exits include Kyle Kosic in 2024, followed by Igor Babuschkin and Christian Szegedy in 2025. In January, co-founder Greg Yang announced he would step back after being diagnosed with Lyme disease. This series of setbacks has fueled speculation about internal turmoil, with The Financial Times reporting that Ba's resignation followed tensions within the technical team over demands to improve AI model performance. The pressure intensified as Musk sought to catch up with competitors like Anthropic and OpenAI.
Adding to the crisis, another xAI engineer, Vahid Kazemi, resigned recently, posting on 11 February: "I left xAI a few weeks ago. That was short! IMO, all AI labs are building the exact same thing, and it's boring. I think there's room for more creativity. So, I'm starting something new." These back-to-back exits are particularly significant as they occur after xAI merged with SpaceX, a move that valued the combined entity at $1.25 trillion. However, Bloomberg notes that the startup could face a funding crunch as it burns cash on data centres, computing resources, and talent acquisition.
Regulatory Probes and Financial Strain
Compounding xAI's challenges, the company is under multiple regulatory probes in Asia, Europe, and the US. These investigations focus on its chatbot Grok AI's image-generating feature, which allegedly mass-produced non-consensual and explicit images, including deepfake porn of real people and children. According to CNBC, the departures coincide with these regulatory pressures, though the company has not immediately responded to queries. The financial strain is evident as xAI navigates these hurdles while trying to maintain its competitive edge in the rapidly evolving AI landscape.
In summary, the resignations of Jimmy Ba and Tony Wu from Elon Musk's xAI underscore a deepening crisis within the startup. With the original founder team halved, financial pressures mounting, and regulatory scrutiny intensifying, xAI faces an uncertain path forward. The exits reflect broader issues of discord and strategic misalignment, potentially hindering the company's ability to innovate and compete in the global AI race.
