The runaway success of OpenAI’s ChatGPT has energised
investors, who have been pouring money into promising AI startups, eager to
uncover the next overnight success.
Riding the investment wave, a crop of foreign AI firms –
including Canada’s Cohere and U.S.-based Anthropic and OpenAI – opened offices
in Europe last year, adding to pressure on tech companies already trying to
attract and retain talent in the region.
Founded in 2010 and acquired by Google in 2014, London-based
DeepMind made its name applying AI to everything from board games to structural
biology.
Now the firm faces a host of well-funded rivals flooding its
territory, while a growing number of its employees have quit to launch their
own ventures.
Recent high-profile exits include co-founder Mustafa
Suleyman, who left to set up California-based Inflection AI alongside LinkedIn
billionaire Reid Hoffman, and research scientist Arthur Mensch, now CEO of
Mistral AI. Both companies have received multi-billion dollar valuations in the
short time they have been active.
In an apparent effort to discourage staff from joining other
companies or starting their own, DeepMind gave a handful of senior researchers
access to restricted stock, worth millions of dollars, earlier this year,
according to a source familiar with the matter.
“It’s a competitive space for sure,” a DeepMind spokesperson
told Reuters, adding that the company “continues to do well in attracting and
nurturing talent”.
CLOSING THE GAP
According to executive search firm Avery Fairbank, there has
been an “exponential increase” in pay for C-suite staff at AI companies in
Britain over the last year.
“The entrance of foreign AI giants such as Anthropic and
Cohere into London’s market will further escalate the competition for AI
talent,” said Charlie Fairbank, the firm’s managing director.
Executives on base salaries of around 350,000 pounds have
seen pay packets jump between 50,000 and 100,000 pounds, he said.
Cohere, which designs in-house chatbots and other tools for
its customers, hired Phil Blunsom, a lead researcher at DeepMind for seven
years, as its chief scientist in 2022.
Sebastian Ruder also joined Cohere from DeepMind in January.
“It’s rare to find a company building a massive business
from scratch, with many of the leading minds in the industry,” he told Reuters.
“When that kind of chance comes along, you take it.”
Ruder declined to comment when asked about his salary.
Ekaterina Almasque, a general partner at venture capital
firm OpenOcean, said DeepMind was no longer the “distant leader in the field”.
“All these companies are competing for the same pool of
talent, and with the AI skills shortage, that’s increasingly more of a pond
than an ocean.”
Suleyman recently began recruiting London-based technical
staff for Inflection AI, while Mensch’s Mistral has fast become one of the
buzziest startups on the continent, raising $415 million in venture funding in
December.
Mistral declined to comment and Inflection did not respond
to a request for comment.
MORE INFLUENCE
OpenAI opened its first international office in London last
year followed swiftly by a second in Dublin – “just the first steps”, said the
company’s Vice President of People Diane Yoon, as it plans to continue
expanding into other countries.
Cohere opened its UK office last year and CEO Aidan Gomez
told Reuters he is now splitting his time between his native Toronto and
London, where the firm plans to double its headcount to 50.
“We go where the talent is, and there’s a lot in London and
across Europe,” Gomez said.
The talent war means workers are increasingly well-placed to
make demands of their prospective employers.
London-based AI audio firm ElevenLabs is offering new hires
stock options, generous salaries and fully-remote working, although most
advertised roles stipulate that employees should be based in Europe.
Having recently raised $80 million in funding from venture
capital firms like a16z and Sequoia, the company told Reuters it would soon
double its total headcount to 100.
Paris-based startup Bioptimus, also founded by former
DeepMind staff, raised $35 million in February.
Thomas Clozel, an early investor in the company said
startups were looking to recruit talent from Big Tech like Google by offering
them more influence over a company’s direction.
“Google is one of the best at what it does and produces some
of the best talent,” he said. “At a smaller startup, you have a unique
opportunity to remain true to the work you are passionate about and have a
stake in the success of the company.”