Every person Elon Musk recruited to co-found xAI has now left — at the moment he is preparing to sell a $1.25 trillion combined entity to public markets via a SpaceX IPO. His answer: hire two engineers from a $2.9B startup and personally review candidates he once rejected.
image from Gemini Imagen 4
All 11 original xAI co-founders have departed as of March 2026, with the last two leaving alongside Musk's public acknowledgment of rejecting qualified candidates. The exodus included both voluntary departures and involuntary ousters for 'underperformance' in the company's coding product, attributed to Musk's 'extremely hardcore' work culture that caused researcher burnout. Musk is now rebuilding the technical foundation by recruiting from Cursor, SpaceX, and Tesla as he prepares a combined $1.25 trillion entity (SpaceX + xAI) for public markets.
Elon Musk recruited the best AI talent in the industry to co-found xAI. Every single one of them has now left.
That is the picture as of late March, when the last two xAI co-founders reportedly departed, leaving Musk as the sole remaining member of the original 11-person founding team. Jimmy Ba and Tony Wu had already left in February, within 24 hours of each other. Zihang Dai and Guodong Zhang — ousted by Musk for underperformance in the company's coding product — were gone before them. Kyle Kosic returned to OpenAI. The rest dispersed to competitors, academic positions, or silence.
The exodus was not subtle. Musk himself acknowledged it on X: "Many talented people over the past few years were declined an offer or even an interview at xAI. My apologies," he posted in March. "We are personally reviewing all rejections."
His answer to rebuilding a foundation that cracked: bring in two engineers from Cursor, a code-generation startup that raised at a $29.3 billion valuation in November 2025, according to CNBC and Reuters. Bring in fixers from SpaceX and Tesla to audit and fire. Personally review applications he previously rejected.
This is happening as Musk prepares to list on public markets a combined entity valued at $1.25 trillion — SpaceX at $1 trillion and xAI at $250 billion in their February 2026 merger. SpaceX filed its IPO application on April 1, 2026. The valuation is not small. The retention problem is not small either.
xAI launched in March 2023 with eleven co-founders and a stated ambition to compete with OpenAI and Google DeepMind for top AI researchers. It succeeded at recruitment. The 1,200-plus person company) attracted talent from every major lab. But the cost of Musk's "extremely hardcore" work culture — researchers left due to burnout or after receiving better offers from rivals — has proven higher than the recruiting budget.
The companies that lost talent to xAI are now taking it back. Project Prometheus, Jeff Bezos's AI manufacturing play founded in November 2025 with $6.2 billion in initial funding, has hired nearly 100 employees including researchers poached directly from OpenAI, DeepMind, and Meta, according to the Los Angeles Times. The Prometheus team is led by Bezos as co-CEO and Vik Bajaj as co-CEO. xAI is not just losing to its rivals. It is losing to its own alumni.
The contradiction is stark: Musk built xAI into a machine for winning recruitment battles. It is losing the retention war. Against that backdrop, the Cursor hires and personal application reviews read less like a rebuild strategy and more like an acknowledgment that the culture problem runs deeper than the talent pipeline.
What happens when the person reviewing rejected candidates is the same person who created the conditions for those rejections? That question will determine whether xAI's second foundation holds — and whether public market investors are buying a company or a recurring crisis.
Revenue was $100 million annualized as of December 2024), according to Wikipedia's xAI entry. Against a $250 billion internal valuation set in the February merger, that multiple requires a story about future dominance, not present fundamentals. The people who would have to build that story are the ones who left.
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