Why Demis Hassabis sold DeepMind to Google in 2014: He needed $7 billion but could “barely raise $10 million” | Today’s news
Google’s current AI CEO Demis Hassabis is also a co-founder of DeepMind and gave a candid account of why he sold DeepMind to Google in 2014. According to a Times of India report, Hassabis said it was pure arithmetic rather than grand strategy.
He estimated that keeping up with the global tech giants would require roughly $7 billion. Unable to scrape through what he said was “barely $10 million at the time,” he fell seriously short of the $7 billion investment required.
According to him, the trigger that made the tech giants take notice was DeepMind agents learning to play classic Atari arcade games without any explanation of the rules or instructions. What Hassabis described as “research output” was enough to make the small London lab famous in Silicon Valley’s artificial intelligence industry at the time.
DeepMind, unlike other tech giants, was just a lab without a product; she had no income or business. Hassabis said this was because the work was on basic technology rather than anything marketable.
“They were coming for my people”
The pay gap also became an issue, with Hassabis saying they were “going after my people,” referring to the tech giants trying to lure his researchers away from him. Hassabis said he is “not pocketing anything” because the researchers took home $100,000 while larger companies offered them up to $10 million.
Ultimately, DeepMind was sold to Google in January 2014 for $650 million after talks with Facebook collapsed a year earlier. Three years of negotiations followed, codenamed “Project Mario,” as Hassabis and co-founder Mustafa Suleyman pushed for a semi-independent DeepMind with a nine-member supervisory board, according to Sebastian Mallaba’s book on Hassabis.
Hassabis eventually stopped pushing because Sundar Pichai refused to let AI leave Google’s core and Reid Hoffman offered $1 billion to back the exit.
Back at the helm
Hassabis is now back at the helm of the company, now known as “Google DeepMind”, with its Gemini product processing more than 10 billion tokens per minute. Alphabet, Google’s parent company, reported $175-185 billion in AI infrastructure spending, roughly 25 times the $7 billion Hassabis sought to raise in 2014 before selling to Google.
