27-Year Veteran Leads New AI Startup! Google Loses Four Key AI Leaders, Stock Dips Over 5%

Alphabet (GOOGL-US) subsidiary Google announced a major overhaul of its artificial intelligence (AI) leadership team on Wednesday (5th). Demis Hassabis, co-founder and CEO of Google DeepMind, will step down from day-to-day operations to become Chairman of DeepMind and Chief Scientist at Alphabet. Meanwhile, Jeff Dean, Google's Chief Scientist with 27 years at the company, will leave to launch a new AI startup. Following the announcement, Alphabet's stock price briefly dropped more than 5% during trading.

At press time, Alphabet (GOOGL-US) shares were down 3.50%, trading at $364.43 per share.

Koray Kavukcuoglu, Chief Technology Officer of Google DeepMind, will be promoted to Senior Vice President, taking over most of Hassabis’s responsibilities. He will oversee Google’s AI model development and report directly to Alphabet CEO Sundar Pichai. He will also lead the development of the next-generation flagship AI model, Gemini 4.

Hassabis stated that now is the right time to step back from DeepMind’s daily operations, allowing him to focus on broader AI development directions. He will collaborate with Pichai on AI-related strategy and global issues.

Dean will co-found a new AI startup, Discovery Loop, with Google senior researchers Sanjay Ghemawat, Oriol Vinyals, and Quoc Le, serving as CEO. The company will be structured as a public benefit corporation, using AI to automate complex, multi-step scientific and engineering workflows, accelerating discoveries in machine learning, hardware design, drug development, and clean energy.

Discovery Loop will initially focus on automating machine learning research and engineering processes. Dean explained that many scientific processes involve iterative steps—hypothesis generation, experiment design and execution, and result evaluation—many of which can be fully computerized, inspiring the company’s name.

The departing members are all key contributors to Google’s AI advancements. Dean co-founded Google Brain and led the development of Tensor Processing Units (TPUs); Vinyals was a major contributor to the protein structure prediction system AlphaFold; Le worked on Google’s mathematical reasoning AI systems.

Google will invest in Discovery Loop and provide cloud and computing resources. Radical Ventures and Khosla Ventures co-led the seed round.

This restructuring comes at a critical time as Google competes with OpenAI and Anthropic in cutting-edge AI models. Google has recently lost top talent: Noam Shazeer joined OpenAI, and AlphaFold Nobel laureate John Jumper moved to Anthropic. Google’s latest Gemini 3.5 Pro has yet to launch, and some Meta models have outperformed Gemini in specific benchmarks, causing investor impatience.

At the same time, Google is significantly increasing its AI infrastructure spending, with estimated annual capital expenditures reaching up to $205 billion. Last quarter, its free cash flow turned negative for the first time. Amid escalating AI competition and rapid spending growth, the departure of core executives and researchers has heightened market concerns about Google’s ability to maintain its AI leadership.