Thinking Machines, an AI startup, keeps Valley on edge with its twists and turns

Turmoil at AI Startup Thinking Machines Lab as Founders Exit and Rejoin OpenAI

Thinking Machines Lab, one of the most closely watched artificial intelligence startups, is facing major internal disruption after several senior founders and employees left the company and returned to OpenAI, highlighting growing tensions in the fast-moving AI industry.

The crisis began on January 12, when Mira Murati, CEO and cofounder of Thinking Machines Lab, was invited to a meeting by Sam Schoenholz, a leading researcher at the company. The meeting included Murati and three other cofounders—Barret Zoph, Luke Metz, and Schoenholz—all of whom had previously worked together at OpenAI, the company behind ChatGPT. Murati had served as OpenAI’s Chief Technology Officer before launching Thinking Machines.

During the meeting, it became clear that Zoph, Metz, and Schoenholz were deeply unhappy with the direction of the startup. They were frustrated that Thinking Machines had fallen behind competitors such as OpenAI and other AI labs in releasing products. The company was also struggling to raise fresh funding at a proposed valuation of $50 billion, which investors reportedly found difficult to justify given its limited product output.

The founders had urged Murati to pursue strategic deals to stabilize the company. Meta, which owns Facebook and Instagram, had discussed the possibility of acquiring Thinking Machines, and Murati had also developed closer ties with the CEO of rival AI firm Anthropic. However, none of these discussions resulted in a completed deal.

Just two days after the meeting, Murati fired Barret Zoph, 32, after discovering that he had been secretly talking since October with Sam Altman, CEO of OpenAI, about returning to the company. Soon after his dismissal, OpenAI rehired Zoph, along with Luke Metz and Sam Schoenholz.

The departures did not stop there. Around nine employees from Thinking Machines’ roughly 100-person workforce have either already joined OpenAI or received offers to do so, further weakening the startup’s position.

The episode underscores the intense competition and personal rivalries shaping the artificial intelligence sector. The industry has increasingly resembled a high-stakes drama, where powerful founders, billion-dollar valuations, and fierce talent battles collide. As AI companies race to dominate the next generation of technology, relationships between former colleagues and rival firms continue to shift rapidly, often with dramatic consequences.

Thinking Machines Lab’s future now remains uncertain as it struggles to retain talent, secure funding, and regain momentum in an industry dominated by well-funded giants like OpenAI.