Musk says xAI 'was not built right' and is being rebuilt from scratch — 10 of 12 co-founders have left
xAI was not built right first time around, so is being rebuilt from the foundations up.
Elon Musk posted on X that xAI "was not built right first time around, so is being rebuilt from the foundations up." The statement came six weeks after the SpaceX acquisition of xAI closed. Of the 12 people who co-founded xAI with Musk in 2023, only two remain — Manuel Kroiss and Ross Nordeen. The co-founder departures accelerated sharply in February 2026 following the merger. Tesla separately invested $2 billion into xAI in the same period. xAI is currently burning approximately $1 billion per month.
This is an unusually direct public admission from a CEO about an ongoing restructuring of a company he owns. The co-founder exodus is not incidental — the people who built Grok and the underlying architecture are largely gone. "Rebuilt from foundations" suggests the product and technical direction is changing, not just personnel. With the SpaceX IPO potentially six months away, xAI's trajectory directly affects the valuation story Musk needs to tell public markets. Grok 3 remains competitive today; what xAI builds next is now an open question.
Every story from each day, delivered at midnight UTC.