Zuckerberg Bid Higher But Lost: Google's $650 Million Acquisition of DeepMind Insider Story Revealed

According to 1M AI News monitoring, journalist Sebastian Mallaby's new book "The Infinity Machine: Demis Hassabis, DeepMind and the Quest for Superintelligence" will be published on March 31. The WSJ has published an exclusive excerpt from the book, revealing in detail for the first time the 2013 insider story of Google and Facebook's (now Meta) battle to acquire DeepMind. Based on over 30 hours of interviews with Hassabis and dozens of conversations with DeepMind colleagues, investors, and acquisition figures.

In June 2013, then-Google CEO Larry Page expressed acquisition interest to DeepMind founder Demis Hassabis at Musk's birthday party: "Your true mission is to create AGI, why not leverage the resources I've already accumulated?" Hassabis recalled that this statement convinced him: "I'm tired of running around trying to raise money. I'll go to Google, get a bunch of compute resources, and then solve the intelligence problem."

Facebook CEO Mark Zuckerberg was simultaneously involved in the bidding. Facebook's Head of Corporate Development Amin Zoufonoun proposed a founder-enriching scheme: lowering the equity acquisition price but providing founders and core members with huge signing bonuses. However, Zoufonoun was dismissive of the AI governance issues raised by DeepMind co-founder Mustafa Suleyman (now CEO of Microsoft's AI division). Hassabis then went to Zuckerberg's home for dinner, intentionally shifting the conversation from AI to virtual reality, augmented reality, 3D printing, and found Zuckerberg equally excited about all technologies. "That told me everything I needed to know," Hassabis later said, "Facebook's offer was higher, but I wanted someone who truly understands why AI is more important than anything else."

During negotiations, Suleyman used poker player instincts to bluff Google, emphasizing that DeepMind had backing from billionaires such as Peter Thiel and Musk ("Of course, these people didn't actually support us"). Hassabis set multiple conditions for the sale: DeepMind to remain in London, prohibition of military applications, establishment of an independent Ethics and Safety Review Board composed of external scientists and philosophers to dilute Google's control over the technology. Google's Chief Negotiator Don Harrison called these conditions "a big problem for me," but ultimately relented because "if we don't absolutely believe that Demis represents the future of our AI strategy, we couldn't agree to this framework."

By the end of January 2014, Google completed the acquisition for $650 million. The rejected Zuckerberg then hired deep learning pioneer and NYU professor Yann LeCun to establish Facebook AI Lab. After LeCun took office, he immediately tried to poach core researchers from DeepMind. Mallaby described the acquisition in the book as "a bargain by today's standards," with the real payoff gradually materializing over the next decade as Google poured billions of dollars in research funds into DeepMind.