To escape OpenAI's massive acquisitions? Microsoft missed out on Cursor, which was snatched up by Musk, and is now competing for the $1 billion startup Inception

AIMPACT News, May 14 (UTC+8), according to Beating Monitoring; Reuters, citing sources, reports that Microsoft is scouring for and negotiating to acquire AI startups to hoard top talent and prepare for the “post-OpenAI era” of independent development. The internally set goal is to launch Microsoft’s own cutting-edge large model next year.

The shopping spree is highly ambitious—at one point, it even targeted a competitor of its own GitHub Copilot. This spring, Microsoft had seriously considered acquiring the code-generation startup Cursor, but ultimately backed out out of concern about an antitrust review by regulators. Soon after, SpaceX, Elon Musk’s company (which bought xAI in February this year), moved quickly to take over and reached a deal with Cursor.

At present, the talent race between Microsoft and SpaceX is focused on Inception, a startup founded by the Stanford team. Inception was established in mid-2024 (Microsoft Venture Capital M12 participated in its $50 million seed round at the end of 2025). They are trying a new route: using a “diffusion” mechanism—usually used to process images and videos—to train large language models by generating and optimizing multiple Tokens at the same time, greatly speeding up the process. Sources say Inception is seeking an acquisition offer of more than $1 billion.

Behind these moves is a substantive loosening of the alliance between Microsoft and OpenAI. In recent years, the two sides’ previously mutually exclusive contracts have been untied multiple times: the revised agreement at the end of 2025 allows Microsoft to develop AGI independently; and just at the end of April this year, OpenAI was also permitted to develop products for direct competitors of Microsoft, such as Amazon.

(Source: BlockBeats)