June 17, 2025 – Scale AI, a startup established in 2016 with a focus on safety, AI alignment, and evaluation services, has recently found itself at the center of a tech industry storm. Last week, the company confirmed a massive $14.3 billion investment from Meta AI. However, this infusion of capital has reportedly caused friction with one of Scale AI’s key clients – Google.
According to Reuters, citing sources familiar with the matter, Google is now planning to sever ties with Scale AI. The tech giant had reportedly been in discussions with several of Scale AI’s competitors even before the Meta investment was officially announced.
Scale AI has built a reputation for providing data labeling and model evaluation services to a wide range of clients, including generative AI companies, large enterprises, and government agencies. In May of last year, the company completed an F – round funding led by venture capital firm Accel, raising 100millionandachievingavaluationof13.8 billion. With Meta’s recent investment, Scale AI’s valuation has skyrocketed to $29 billion.
The current AI landscape is marked by intense competition, with major tech giants vying for dominance through investments and acquisitions. This has led to an escalation of rivalries and conflicts. Earlier this month, the AI programming assistant platform Windsurf was acquired by OpenAI for $3 billion. Shortly after the acquisition, Anthropic significantly reduced the call quotas for Windsurf’s access to its Claude 3.x model. While Anthropic cited “optimizing model capacity allocation for long – term partners” as the reason, the industry widely views this as a move driven by competition among the tech giants.
In the case of Scale AI, the Meta investment seems to have disrupted the delicate balance of client relationships. As the AI race continues to heat up, such strategic investments and their repercussions are likely to become more common, further shaping the dynamics of the tech industry.
