HomeMost PopularThe AI Talent Tug-of-War Galvanizes Europe's Tech Landscape

The AI Talent Tug-of-War Galvanizes Europe’s Tech Landscape

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By Martin Coulter

LONDON, March 11 (Reuters) โ€“ As European tech hubs brace for an influx of artificial intelligence (AI) startups, a fierce battle for technical talent ensues, with major players like Google DeepMind GOOGL.O facing the dilemma of either shelling out massive sums or forfeiting access to the cream of the crop.

The meteoric rise of OpenAIโ€™s ChatGPT has not only captivated investors but has also sparked a scavenger hunt for the next star AI startups, drawing hefty investments into the sector.

Capitalizing on this trend, a cohort of international AI companies โ€“ including Cohere from Canada, and Anthropic and OpenAI from the U.S. โ€“ have established European bases, intensifying the competition for technical talent and putting pressure on incumbent tech firms.

DeepMind, founded in 2010 and acquired by Google in 2014, gained eminence by leveraging AI across diverse fields, ranging from board games to structural biology.

However, the company now finds itself besieged by well-funded rivals encroaching on its territory, with a growing number of its employees departing to launch their ventures.

Notable exits include co-founder Mustafa Suleyman, who ventured into establishing Inflection AI in California alongside LinkedIn tycoon Reid Hoffman, and research scientist Arthur Mensch, now at the helm of Mistral AI. Both startups have swiftly catapulted to multi-billion dollar valuations.

In a bid to dissuade staff from jumping ship or embarking on solo ventures, DeepMind reportedly granted a select group of senior researchers access to lucrative restricted stock, valued at millions of dollars, earlier this year.

โ€œItโ€™s a cutthroat arena for sure,โ€ remarked a DeepMind spokesperson, affirming the companyโ€™s continued success in attracting and nurturing top talent.

Narrowing the Talent Chasm

Insights from executive search firm Avery Fairbank suggest a drastic surge in compensation for C-suite personnel at AI companies in the UK over the past year.

โ€œThe incursion of foreign AI behemoths such as Anthropic and Cohere into Londonโ€™s market is set to further intensify the battle for AI talent,โ€ noted Charlie Fairbank, the firmโ€™s managing director.

Executives on base salaries around 350,000 pounds have witnessed salary hikes ranging between 50,000 and 100,000 pounds, illustrating the escalating competition.

Cohere, specializing in bespoke chatbots and other solutions, secured Phil Blunsom, a veteran researcher at DeepMind for seven years, as its chief scientist in 2022.

Sebastian Ruder, another DeepMind alum, also joined Cohere earlier this year, underscoring the companyโ€™s magnetic appeal to industry luminaries.

โ€œFinding a company that is crafting a substantial enterprise from scratch, with a cadre of industry leaders, is a rare opportunity. When such a chance presents itself, one seizes it,โ€ expressed Ruder.

Ruder abstained from commenting on his compensation package.

Ekaterina Almasque, a general partner at venture capital firm OpenOcean, remarked that DeepMind no longer enjoys an undisputed leadership position in the sector.

โ€œWith these firms vying for a similar pool of talent, and the scarcity of AI skills, the talent pool is starting to resemble a pond rather than an ocean,โ€ Almasque explained.

Recent endeavors by Suleyman and Mensch to recruit technical talent for their startups indicate the burgeoning prominence of entities like Inflection AI and Mistral, the latter having amassed $415 million in venture funding in December.

While Mistral opted for silence, Inflection refrained from responding to requests for comments.

Amplifying Influence

OpenAIโ€™s foray into Europe commenced with the opening of its first overseas office in London last year, swiftly followed by a subsequent establishment in Dublin. Diane Yoon, the companyโ€™s Vice President of People, hinted at these being mere initial strides, with plans afoot for further expansion into other countries.

Similarly, Cohere unveiled its UK office last year, prompting CEO Aidan Gomez to split his time between Toronto and London, with intentions to double the companyโ€™s workforce to 50 employees.

โ€œWe gravitate towards talent hubs, and London and Europe in general boast an abundance of it,โ€ Gomez remarked.

The talent warfare has empowered workers to assert their demands on prospective employers, exemplified by London-based AI audio company ElevenLabs offering new recruits stock options, competitive salaries, and remote working opportunities, albeit with a European base requirement for most advertised vacancies.

Having recently secured an $80 million funding injection from venture capital heavyweights like a16z and Sequoia, ElevenLabs disclosed plans to double its headcount to 100 in the near future.

Meanwhile, Bioptimus, a Parisian startup helmed by former DeepMind personnel, raised $35 million in February.

Thomas Clozel, an early investor in Bioptimus, noted that startups are looking to entice talent from tech titans like Google by offering a higher degree of influence over the companyโ€™s trajectory.

โ€œGoogle sets the gold standard in its domain and churns out top-tier talent. By joining a smaller startup, individuals have a unique opportunity to remain aligned with their passions and be vested in the companyโ€™s prosperity,โ€ Clozel elucidated.

(Reporting by Martin Coulter; Editing by Matt Scuffham, Kirsten Donovan)

(([email protected]; Follow me on Twitter @martinjbcoulter; +447436546182;))

The opinions and views expressed herein belong solely to the author and do not necessarily echo those of Nasdaq, Inc.

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