In a significant development, Character.AI co-founder and CEO Noam Shazeer is returning to Google after founding the a16z-backed chatbot startup in October 2021. During his previous tenure at Google, Shazeer led the team that developed LaMDA (Language Model for Dialogue Applications), a key language model for conversational AI.
Character.AI co-founder Daniel De Freitas, along with several other employees from the startup, will also be rejoining Google. Dominic Perella, Character.AI’s general counsel, will serve as interim CEO of the startup. The majority of Character.AI staff will remain with the company.
Google Partnership
Google has entered into a non-exclusive agreement with Character.AI to utilize its technology. Shazeer expressed his enthusiasm for returning to Google and joining the DeepMind team, highlighting his pride in Character.AI’s achievements over the past three years.
“I am super excited to return to Google and work as part of the Google DeepMind team. I am so proud of everything we built at Character.AI over the last 3 years. I am confident that the funds from the non-exclusive Google licensing agreement, together with the incredible Character.AI team, positions Character.AI for continued success in the future,” Shazeer said in a statement.
Google confirmed Shazeer’s and De Freitas’s integration into the DeepMind research team, though their exact roles were not specified. A Google spokesperson emphasized that this agreement will provide Character.AI with increased funding to continue its growth and focus on building personalized AI products globally.
Character.AI’s Future Plans
Character.AI has raised over $150 million in funding, primarily from a16z. The company acknowledged the evolving landscape of AI development and expressed its intention to leverage third-party language models (LLMs) alongside its own.
“When Noam and Daniel started Character.AI, our goal of personalized superintelligence required a full stack approach. We had to pre-train models, post-train them to power the experiences that make Character.AI special, and build a product platform with the ability to reach users globally,” Character.AI mentioned in its blog announcing the move.
“Over the past two years, however, the landscape has shifted; many more pre-trained models are now available. Given these changes, we see an advantage in making greater use of third-party LLMs alongside our own. This allows us to devote even more resources to post-training and creating new product experiences for our growing user base.”
Regulatory Scrutiny
The move could attract regulatory scrutiny from bodies such as the Federal Trade Commission (FTC) and the Department of Justice (DoJ) in the U.S., and the EU. The U.K’s Competition and Markets Authority (CMA) recently issued a notice examining Microsoft’s hiring practices from Inflection AI, suspecting potential regulatory oversight avoidance. The FTC also initiated an investigation in June into Microsoft’s $650 million deal for similar concerns.
As Character.AI navigates these changes, the industry will closely watch the impact of Shazeer and De Freitas’s return to Google and how it influences the future trajectory of AI development and regulation.
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