Scale AI, a data-labeling company, has recently confirmed a 'significant' investment from Meta, valuing the startup at $29 billion. The co-founder and CEO, Alexandr Wang, will be leaving his role to join Meta and assist the company with its AI initiatives.

Meta reportedly invested around $14.3 billion for a 49% stake in Scale AI. The startup specializes in producing and labeling data used to train large language models crucial for generative AI development.

Meta has officially announced the investment, stating that they will deepen their collaboration with Scale AI in producing data for AI models. Wang will be joining Meta to contribute to their superintelligence projects.

Jason Droege, Scale's current chief strategy officer, will take over as interim CEO. The investment from Meta will be utilized to compensate investors and shareholders, as well as to drive growth. Scale AI has emphasized that it will remain an independent entity, with Wang continuing as a director on the board.

This move by Meta is seen as a strategic effort to enhance their AI capabilities in the face of competition from companies like Google, OpenAI, and Anthropic. Meta's AI model releases have lagged behind, and the company has lost 4.3% of its top talent to other AI labs in the past year, according to data from SignalFire.

Leading AI labs, including OpenAI, have relied on Scale AI for producing and labeling data for training models. Recently, Scale AI and its competitors in data annotation have been recruiting highly skilled individuals like PhD scientists and senior software engineers to create top-quality data for cutting-edge AI labs.

Last year, Scale AI raised $1 billion from investors like Amazon and Meta at a valuation of $13.8 billion.