xAI loses second co-founder in two days as company prepares for IPO

xAI

• xAI loses co-founder Jimmy Ba, second leadership departure in two days
• xAI merged with SpaceX, valued at $250B, and faces regulatory probes worldwide
• Grok chatbot tools under scrutiny for generating explicit deepfake images

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Elon Musk’s xAI is facing mounting scrutiny after losing another key figure from its founding team. Influential AI researcher Jimmy Ba announced on Tuesday that he is stepping away from the company, marking the second co-founder departure in just two days.

Ba confirmed his exit in a post on X, where he thanked Musk and said he was “grateful to have helped cofound at the start.” His departure follows closely after fellow co-founder Tony Wu revealed his own exit a day earlier.

The back-to-back announcements come shortly after xAI completed a major corporate reshuffle, merging with Musk’s aerospace company SpaceX earlier this month. The combined entity is now reportedly preparing for a public listing later this year.

Ba, a professor at the University of Toronto, was widely credited for foundational research that influenced xAI’s Grok 4 models. He joins a growing list of original founders who have departed the company. Other co-founders to exit include Igor Babuschkin, Kyle Kosic and Christian Szegedy. Greg Yang announced last month that he would step back from day-to-day responsibilities to focus on treatment for Lyme disease.

According to documents viewed by CNBC, the all-stock merger valued SpaceX at roughly $1 trillion and xAI at $250 billion. Musk has increasingly relied on xAI as a vehicle for consolidating his businesses. Earlier this year, xAI was also used to acquire X, the social network formerly known as Twitter, in another stock-based transaction.

The leadership churn comes at a sensitive moment for xAI. The company is currently facing regulatory probes across multiple regions, including Europe, Asia and the United States. Authorities are investigating incidents in which xAI’s Grok chatbot and image tools were used to generate and distribute non-consensual explicit images, including deepfake content involving real individuals and, in some cases, minors.

Musk founded xAI in 2023 with a group of 11 researchers, positioning it as a challenger to OpenAI and Google. At launch, the company said its mission was to “understand the true nature of the universe,” a goal Musk has repeatedly cited when discussing the venture.

xAI has not made any public comment on the matter so far.