Microsoft Seeks Acquisition of AI Startup to Prepare for Split from OpenAI

According to Reuters, citing five informed sources, Microsoft is actively seeking to acquire an artificial intelligence startup with the aim of reducing dependence on OpenAI, stockpiling AI talent, and striving to release its own cutting-edge model next year.

This spring, Microsoft seriously considered acquiring code generation startup Cursor but ultimately backed out due to internal beliefs that the deal might not pass regulatory scrutiny. The reason was that Microsoft already owns GitHub Copilot, which clearly overlaps with Cursor's business. After Microsoft withdrew, SpaceX immediately announced a deal with Cursor.

Currently, Microsoft is in talks with the startup Inception. Inception, founded by a Stanford University team in mid-2024, focuses on generating text using diffusion technology, which is different from the way mainstream large models generate words one by one. This method can generate and optimize multiple word elements simultaneously, theoretically significantly improving inference speed. Microsoft's venture capital fund M12 has participated in Inception's $50 million seed round of financing. Informed sources say that talks are ongoing and it is not yet certain whether an agreement can be reached, with Inception's asking price exceeding 1 billion dollars.

SpaceX is also vying for Inception, and the competition for AI talent is unfolding on multiple fronts. Microsoft's Head of Corporate Development, Michael Wetter, confirmed in court this week that Microsoft has invested more than 100 billion dollars in OpenAI and the construction of related infrastructure.

Microsoft has been cooperating with OpenAI since 2019, but the relationship between the two sides has been continuously frictional in recent years. The contract revised at the end of 2025 allowed Microsoft to independently develop general artificial intelligence, and the new agreement in April this year gave OpenAI the freedom to cooperate with Amazon and other Microsoft competitors, with both sides gradually moving towards independence.