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It's hard to compete with Elon Musk when recruiting AI talent, CEO says

The xAI and Grok logos are seen in this illustration photo taken on 05 November, 2023 in Warsaw, Poland. Elon Musks's xAI company this week introduced Grok, its converstional AI which is says can match GPT 3.5 in performance.
Elon Musk launched xAI last year.Getty Images
  • Perplexity CEO Aravind Srinivas said Elon Musk's xAI is stiff competition in the recruiting space.

  • The AI CEO said Musk's company offers the highest compensation at the moment.

  • It's also difficult to compete with Musk's celebrity status, the CEO said.

In the battle for AI talent, Elon Musk holds considerable sway.

Aravind Srinivas, the CEO of the AI company Perplexity, said it can be difficult to compete with the Tesla CEO when recruiting.

Musk launched his own AI startup, xAI, last year and Srinivas said it has since become one of the highest-paying companies for AI talent — on par with OpenAI. Last year, The Wall Street Journal reported that OpenAI was offering salary packages as high as $900,000.

"Whoever has the highest valuation will be able to win this race all the time because, on paper, you're always going to be able to offer the same amount of shares but the dollar value is going to be much higher," Srinivas told The Verge's Alex Heath.

OpenAI hit a reported $80 billion valuation last month. Meanwhile, Perplexity was finalizing a deal that would value it at about $1 billion, The Journal reported earlier this month.

"Whatever offer we make, the same offer made by xAI is more valuable because they say on paper that they're valued more," he added.

Heath reported that xAI recruits have been told by the company that their stock options are tied to a $25 billion valuation. In January, Financial Times reported that Musk's AI venture was in talks to raise $6 billion at around a $20 billion valuation.

Perplexity makes a product that provides answers to people's questions powered by AI. It competes against OpenAI's ChatGPT and xAI's Grok, among others in the space.

Srinivas said Stripe CEO Patrick Collison told him he was chasing the wrong hiring candidates after he tried to recruit a senior software engineer who was also being recruited by xAI. Instead, Collison told the CEO to focus on finding people who "want to actually build the stuff that you're building," Srinivas said.

The AI CEO said that his company has more users than xAI's Grok, a chatbot that is only available to premium subscribers on the social media site X. It's not clear how many X Premium users there are, but TechCrunch reported in October that the social media site formerly known as Twitter had less than 900,000 subscribers. (xAI is a separate corporation from the social media site X, but the two companies work closely together under Musk, according to xAI's website.)

Nonetheless, Srinivas said the fact that xAI's leader is Musk — who has a celebrity status and cult following unlike any other CEO in tech — is a significant hurdle.

"We have the right to say, 'You should consider us approximately in the same ballpark,'" Srnivas said. "But then they say, 'No, Elon Musk is different.' So that makes it difficult to compete with X.AI."

It's not the first time that the Perplexity CEO has highlighted just how ruthless hiring in the AI space can be. Earlier this month, Srinivas said on a podcast that he'd faced difficulty trying to hire a Meta employee because his company didn't have as many GPUs or, in other words, as many graphic-processing units to power and train its AI systems as Mark Zuckerberg's company.

A role at one of Musk's companies has always been something highly sought after in the tech world — whether its xAI, Tesla, X, or SpaceX. Earlier this year, Fortune reported that X received thousands of applications even after the company very publicly laid off over half its workforce last year. Similarly, Tesla hires previously told Business Insider that recruits are more willing to accept lower pay to work under Musk.

Representatives for Srinivas and Musk did not immediately respond to a request for comment.

Do you work for one of Musk's companies or have insight to share? Reach out to the reporter from a non-work email and device at gkay@businessinsider.com

Read the original article on Business Insider