Meta reportedly eyed Perplexity before Scale AI deal

Meta considered acquiring Perplexity AI before finalizing a US$14.3 billion investment in Scale AI, according to sources familiar with the matter.

However, negotiations between Meta and Perplexity AI did not result in a deal.

One source said the decision was “mutually dissolved,” while another claimed Perplexity walked away.

Both companies declined to comment.

The approach to Perplexity highlights Meta’s push to strengthen its AI capabilities amid rising competition from OpenAI and Google.

Following its investment, Meta now holds a 49% stake in Scale AI, though without voting rights. Earlier this year, Meta also tried to acquire Safe Superintelligence.

🔗 Source: CNBC

🧠 Food for thought

1️⃣ Meta’s acquisition strategy has evolved dramatically for AI

Meta’s approach to acquisitions represents a significant shift from its historical pattern. While the company traditionally focused on smaller “acqui-hires,” where they bought companies primarily for talent, their recent AI-focused moves show a willingness to make much larger investments.

Meta’s previous acquisitions rarely exceeded a few billion dollars, with Instagram ($1B) and WhatsApp ($16B) being notable exceptions among its 91 company purchases 1.

The reported attempts to acquire Perplexity and buy Safe Superintelligence, along with the completed $14.3B investment in Scale AI, represent a dramatic escalation in spending specifically for AI capabilities 2.

This shift reflects Zuckerberg’s apparent sense of urgency about AI. He’s willing to deploy significant capital to close perceived gaps with competitors like OpenAI and Google, rather than relying on Meta’s traditional build-it-yourself approach.

2️⃣ The AI talent war has reached extraordinary levels

Meta’s simultaneous pursuit of multiple AI companies reveals the intensity of the current talent competition in the AI industry, with compensation reaching unprecedented levels.

According to OpenAI’s CEO Sam Altman, Meta offered individual OpenAI employees signing bonuses as high as $100 million, with even larger annual compensation packages—figures that would have been unthinkable even in tech’s traditionally high-paying environment 2.