Key facts
- Igor Babuschkin, a co-founder of xAI, has launched a new startup named River AI.
- River AI aims to build personalized AI systems that users can shape, own, and align with their values.
- The startup is reportedly in discussions to raise as much as $1 billion in funding at a potential $5 billion valuation.
- Babuschkin plans to invest up to $100 million of his own money into River AI.
- The venture includes former xAI and Tesla Inc. staffers.
Igor Babuschkin, a co-founder of Elon Musk's xAI, has launched a new artificial intelligence startup named River AI. The company aims to develop personalized AI systems that give individual users genuine sovereignty over how their AI behaves, challenging the current model of corporate-controlled AI services. Babuschkin, who previously worked at OpenAI and Google DeepMind, announced the venture on April 20, and it has already attracted significant investor interest.
River AI is reportedly in discussions to raise as much as $1 billion in funding at a potential $5 billion valuation, with General Catalyst in talks to lead the round. Babuschkin himself plans to invest up to $100 million of his own capital into the startup. The company's core thesis is that the future of AI lies in systems that users can shape, own, and align with their own values, rather than renting services from corporations.
Babuschkin's departure from xAI aligns with a broader trend of AI researchers and engineers leaving major labs to form their own companies. xAI itself was founded in March 2023 as an alternative to what Musk perceived as overly cautious AI development. The company underwent restructuring in early 2026, coinciding with the departure of several key staff members.
While River AI has not yet revealed specific product details or technical whitepapers, its vision is to create AI that works for the individual rather than a corporation. This approach directly contrasts with current offerings from major AI labs like OpenAI, Google, and Anthropic, which provide customizable but ultimately corporate-controlled AI services. The potential $5 billion valuation for a pre-product company is considered aggressive, highlighting Babuschkin's commitment and the perceived potential of River AI's vision.