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OpenAI to Acquire AI Device Startup for $6.5 Billion
Meta Launches Program to Boost Startup Adoption of Llama AI Models
Algot Persson
May 21, 2025
In Today’s Issue:
OpenAI to Acquire AI Device Startup for $6.5 Billion
Meta Launches Program to Boost Startup Adoption of Llama AI Models
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OpenAI to Acquire AI Device Startup for $6.5 Billion
OpenAI announced it will acquire io, an AI device startup co-founded by former Apple design chief Jony Ive, in a $6.5 billion all-stock deal. This marks OpenAI’s largest acquisition to date and a major move into hardware development. The deal secures Ive and a team of former Apple designers, including veterans behind the iPhone, iPad, and Apple Watch, who will work with OpenAI CEO Sam Altman to create a new family of AI-powered devices. Their first product is expected to launch in 2026 and promises to introduce a “truly novel” type of consumer hardware. Ive, who left Apple in 2019, called the collaboration with Altman a defining moment in his career, emphasizing a fresh approach to technology. Altman highlighted the need for new computing form factors to fully leverage AI advancements. The acquisition adds about 55 hardware and software experts to OpenAI, who will continue to innovate in San Francisco alongside OpenAI’s current teams. The move intensifies competition with Apple, which is currently lagging behind in AI innovation. While details on the devices remain under wraps, both leaders believe the new products will not replace smartphones but offer new ways to interact with AI. The deal is expected to close this summer, pending regulatory approval.
Altman and Ive
Meta Launches Program to Boost Startup Adoption of Llama AI Models
Meta
Meta has introduced Llama for Startups, a new initiative offering U.S.-based startups funding and direct support to encourage the use of its Llama AI models. Eligible companies—those incorporated in the U.S., with less than $10 million raised, at least one developer, and working on generative AI—can receive up to $6,000 monthly for six months plus expert guidance. The application deadline is May 30. This move aims to strengthen Meta’s position in the competitive open AI model market, where rivals like Google and Alibaba also compete. Despite Llama’s billion-plus downloads, recent setbacks include delays in launching Llama 4 Behemoth and controversy over benchmark testing. Meta envisions significant revenue growth from its generative AI portfolio, projecting $2–3 billion in 2025 and up to $1.4 trillion by 2035. The company continues investing heavily, with a 2025 capital expenditure plan of $60–80 billion focused on data centers and AI infrastructure.
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