Microsoft agreed to pay Inflection $650 million while hiring its staff: report

Microsoft has agreed to pay Inflection about $650 million while hiring the AI startup's staff, a person familiar with the matter told Reuters on Thursday.

The transaction is mostly in the form of a licensing deal that makes Inflection's models available for sale on Microsoft's Azure cloud service, the person with direct knowledge on the deal said.

The software giant hired Inflection co-founders Mustafa Suleyman and Karen Simonyan, along with several employees of the AI firm, for a newly created consumer AI unit called Microsoft AI.


Inflection is using the licensing fee to provide some investors, including Greylock and Dragoneer Investment Group, a one-time and half times of return, the source added.

Microsoft and Inflection AI did not immediately respond to Reuters' requests for comments.