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The co-founder of xAI has resigned to establish a new investment fund

Nigar Sultanli
xAI
14 August 2025 10:37
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The co-founder of xAI has resigned to establish a new investment fund

Igor Babuschkin has announced that he is leaving xAI, the company he co-founded with Elon Musk in 2023. In a post on the social media platform X (formerly Twitter), he stated that he will be launching a new investment fund, Babuschkin Ventures. The fund aims to promote AI safety and support startups in science and technology that can benefit humanity.

According to Babuschkin, the idea for the fund emerged after a meeting with Max Tegmark, founder of the Future of Life Institute. During their discussion, they explored ways to develop artificial intelligence without causing harm to future generations.

His resignation comes amid a series of recent controversies surrounding xAI. The company’s AI chatbot, Grok, has faced heavy public criticism on several occasions. In some cases, Grok incorporated Elon Musk’s personal opinions into its answers, used antisemitic language, and even referred to itself as “Mechahitler.” In the most recent scandal, a new Grok feature allowed users to create fake explicit videos of public figures, including singer Taylor Swift.

Nevertheless, xAI’s technology continues to be highly regarded. The company’s AI models are competitive with industry leaders such as OpenAI, Google DeepMind, and Anthropic across multiple benchmarks.

Before co-founding xAI, Igor Babuschkin worked at Google DeepMind, where he contributed to the creation of AlphaStar, an AI system capable of defeating top-ranked players in the game StarCraft. He also served as a researcher at OpenAI.

During his time at xAI, Babuschkin and Elon Musk built a massive AI supercomputer in Memphis in just three months — a goal many in the industry had called “impossible.” However, environmentalists have warned that the temporary gas turbines powering the system release harmful emissions into surrounding communities.

Reflecting on his years at xAI, Babuschkin emphasized two key lessons he learned from Elon Musk:

  • Never hesitate to personally engage in solving technical problems.
  • Maintain a strong sense of urgency and speed in work.

He compared his departure to “a proud parent driving away after sending their child off to college.”

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