Google Drops $2.7 billion… to Hire One (Yes, ONE) Guy Back...

Apparently, when you’re Google and you’re getting your lunch eaten by OpenAI in the generative AI arms race, you just casually throw around $2.7 billion like it’s pocket change. And not for some shiny new startup or groundbreaking tech… but to rehire a guy you already had on the payroll.

(Source: Giphy) 

Yep, Google just coughed up $2.7 billion to bring back Noam Shazeer—one of their OG engineers who peaced out after getting tired of Google’s “slow and steady” (read: painfully slow) AI strategy. And no, that’s not a typo: three billion dollars. For one dude. Sure, technically the deal is for licensing Character.AI’s tech, but let’s be honest—it’s all about getting Shazeer back in the building.

(Source: New York Post) 

ICYMI, Shazeers is kind of a big deal in the AI world. He joined Google back in 2000, which, in tech years, is basically the Jurassic period - and he even co-authored the paper that literally laid the foundation for today’s AI boom. However, in 2021, Shazeer dipped after Google decided to play it safe and shelve a chatbot project he was working on. Bigly loss for Google. 

(Source: QZ) 

However, after leaving the tech giant, Shazeer didn’t exactly ride off into the sunset. His new gig, Character.AI, went from being a startup no one had heard of to a $1 billion company that had investors tripping over themselves to get a piece of the action. Meanwhile, Google sat on the sidelines, licking its wounds and watching OpenAI’s ChatGPT go nuclear. And suddenly, Google looks like a turtle chasing a rabbit in the generative AI race. Hence, their atrocious “Bard” chatbot. 

(Source: Business Insider) 

But, but, but… it seems like Google has finally realized what they had until it was gone: Their big tech version of Tom Brady. Which is why fast forward to today, and Googles rolling up with an offer he can’t refuse. Literally. With a massive $2.7 billion check, Google now has licensing rights to Character.AI’s tech which will be integrated into their Gemini AI project.

This has the industry calling it a “reverse acqui-hire”—instead of buying the company to get the talent, Google’s licensing the tech and getting the guy who built it back in the process. Genius? Maybe. Desperate? Kinda looks that way. 

(Source: Giphy) 

Which is why not everyone is convinced that throwing $2.7 billion at Shazeer is a slam dunk. Christopher Manning, the big dog over at Stanford AI Lab, had this to say: “Is he 20 times as good as other people?” Ooof. And that’s the real question here, isn’t it? Shazeer’s a beast, no doubt—but is he worth more than the GDP of some small countries?

Obviously, Google seems to think so. But when you step back and really look at this reverse acqui-hire, it’s not really surprising. This is the new R&D of 2024: Google, Microsoft, and Meta keep throwing Monopoly money at AI talent -  OpenAI’s been handing out $10 million packages to Google employees like candy on Halloween. Meanwhile, Zuckerberg and Sergey Brin are out here personally writing recruitment letters. It’s chaos I tell you…

(Source: Medium) 

But still, for Shazeer, this is no doubt a massive win. Not only did he prove that his chatbot was worth betting on, but he’s also walking away with hundreds of millions from his stake in Character.AI. And now? He’s back at Google, leading the charge on the next generation of AI tech. Talk about a full-circle moment. 

(Source: Giphy) 

On the other hand, for Google, this is their do-or-die moment. And they’ve just made it loud and clear that they’re willing to pay whatever it takes to stay in the game. Now whether Shazeer is really worth that $2.7 billion check… Well, only time will tell. 

In the meantime though, Google is up +1.17% from yesterday's close - so obviously the bulls seemed to view this seismic cash burn as a positive… for now anyway. As always, stay safe and stay frosty, friends! Until next time… 

P.S. The alert we dropped yesterday has already popped +28.68%, and with a Cost to Borrow pushing 600%, this stock is about to crank it up another notch. If you’re thinking you missed your shot, think again—there’s still plenty of juice left in the orange. Don’t be the person “crying in da club” this time—click here to get in on the second leg before it blows up even more.

Stocks.News holds positions in Google, Microsoft, and Meta Platforms as mentioned in the article.