Elon Musk Says xAI ‘Was not Built Right First Time Around’ after Most Co-Founders Leave

FomoAnxiety · 2026-03-13T18:14:10+00:00

Elon Musk's AI startup xAI is undergoing a complete rebuild after significant co-founder departures, raising concerns about its initial structure. Musk acknowledged past hiring failures and is now revamping recruitment efforts while managing further layoffs to improve coding products.

FomoAnxiety

2026-03-13 18:14:10

Abstract generation in progress

Elon Musk said that his artificial intelligence startup xAI is being rebuilt after a wave of departures have seen most of its original co-founders leave the company. Notably, Zihang Dai was the most recent one to exit, and the departures have raised questions about the company’s early structure. In response, Musk admitted that the company was not built correctly at the beginning. Writing on X, he said that xAI “was not built right first time around” and that the company is now being rebuilt from the ground up.

Claim 70% Off TipRanks Premium

Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
Stay ahead of the market with the latest news and analysis and maximize your portfolio’s potential

Interestingly, this is similar to what Tesla TSLA -0.54% ▼ went through earlier in its history. Musk also apologized for how the company handled hiring in the past. More specifically, he said that many talented people had been rejected or never even interviewed during the early stages of building the firm. As a result, Musk explained that he and xAI executive Baris Akis are reviewing the firm’s past interview records and reaching out to promising candidates.

Meanwhile, reports from the Financial Times said that Musk has ordered another round of layoffs at xAI after becoming frustrated with the company’s coding product. To address the issue, he has reportedly brought in engineers from Tesla and SpaceX to audit the startup’s work. Despite the turmoil, the company has continued to grow and recently raised $20 billion in a Series E funding round.

What Is the Prediction for TSLA Stock?

When it comes to Elon Musk’s companies, most of them are privately held. However, retail investors can invest in his most popular company, Tesla TSLA -0.54% ▼ . Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 13 Buys, 11 Holds, and seven Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $399.25 per share implies that shares are trading near fair value.

Disclaimer & DisclosureReport an Issue

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.