AI giant reportedly preparing investment in brain-computer interface company competing directly with Elon Musk's neural implant technology venture.
OpenAI CEO Sam Altman is co-founding a brain-computer interface startup called Merge Labs that will compete directly with Elon Musk's Neuralink, with OpenAI's venture arm expected to provide significant backing, according to multiple reports citing sources familiar with the matter.
The venture, valued at $850 million, is seeking to raise $250 million with much of the capital expected to come from OpenAI's ventures team, the Financial Times reported Tuesday. The move marks the latest escalation in the rivalry between Altman and Musk, who co-founded OpenAI together before a bitter falling out.
A Challenge to Neuralink
Merge Labs will focus on developing high-bandwidth brain implants that integrate human cognition with artificial intelligence, directly competing with Neuralink's mission to connect human brains with computers. The startup is reportedly working with Alex Blania, CEO of Tools for Humanity (formerly World), Altman's eye-scanning digital ID venture that allows anyone to verify their humanness.
A source familiar with the deal told TechCrunch that talks are still early and OpenAI has not yet committed to participation, meaning terms could change. However, the potential investment represents a significant bet on the convergence of AI and neuroscience.
While Altman will carry the title of co-founder, he is not expected to have a day-to-day role in the new project and will not personally invest in the venture, according to the Financial Times. OpenAI declined to comment on the reports.
The Fight for Brain-Computer Interfaces
The news comes as Neuralink continues to make significant progress in the field. Musk's company, founded in 2016, is currently conducting trials with people who suffer from severe paralysis, aiming to allow them to control devices with their thoughts. In June, Neuralink raised $650 million in a Series E funding round at a $9 billion valuation.
"Five individuals with severe paralysis are now using Neuralink to control digital and physical devices with their thoughts, marking a profound step toward helping restore independence," Neuralink stated in a June press release.
The brain-computer interface market is attracting significant investment beyond just these two rivals. In April 2024, Tether announced a $200 million investment, granting it a majority stake in Blackrock Neurotech, another brain-computer interface technology firm.
The Philosophy of "The Merge"
Merge Labs' name reportedly derives from what its founders describe as "the merge" — a moment when humans and machines come together. This concept isn't new to Altman, who wrote extensively about it in a 2017 blog post.
"Although the merge has already begun, it's going to get a lot weirder. We will be the first species ever to design our own descendants," Altman postulated at the time, citing research work he saw at OpenAI when Musk was still a co-founder.
The philosophical divide between Silicon Valley's two most prominent AI leaders reflects broader questions about humanity's technological future. While both pursue brain-computer interfaces, their visions and approaches diverge significantly.
With both tech titans now competing in the brain-computer interface space alongside their AI rivalry, the next decade promises rapid innovation in technologies that could fundamentally alter how humans interact with machines — and potentially, what it means to be human itself.
