Google has halted multiple projects with Scale AI just hours after the tech giant’s massive $14.3 billion investment in the data labeling startup. This move comes as other companies, including OpenAI and xAI, have paused their work with Scale AI.
Scale AI, which helps major tech companies like Google, Apple, and Microsoft train and improve their AI models, is now facing challenges to its business due to Meta’s blockbuster deal to buy 49% of the startup. The relationship between Scale AI and its clients is in doubt, as one investor has decided to sell their remaining stake in the company.
According to internal correspondence obtained by Business Insider, contractors working on Google projects with codenames like “Genesis” and “Beetle Crown” received emails notifying them that their work was being paused. The move follows a spring pause of a large-scale AI project with Scale AI, which left workers scrambling for new work opportunities.
Scale AI’s interim CEO Jason Droege said the company remains “unequivocally independent” and has “multiple promising lines of business.” However, contractors working on Google-related projects reported scarce work availability, with some dashboard displays showing empty or inactive projects. The situation raises concerns about Scale AI’s ability to maintain its business despite losing major clients like Google.
Other companies affected by the Meta- Scale AI deal include xAI and OpenAI, which have also paused their work with the startup. An internal dashboard showed that Scale AI was running at least 38 active projects for Google at the time of the pause. However, it is unclear whether this expanded relationship can offset the revenue hit from losing major clients like Google.
Source: https://www.businessinsider.com/google-xai-openai-pull-back-meta-scale-ai-investment-2025-6