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Comment by htrp | Hacker News Reader

>Character.AI co-founder Daniel De Freitas is also joining Google with some other employees from the startup. Dominic Perella, Character.AI’s General Counsel, is becoming an interim CEO at the startup.

So basically leaving a shell of a company and the GC to try and run it / wind it down.

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Is this a cheat code for doing an acquisition without FTC scrutiny?

And screw investors

per The Information -- investors don't get screwed, the board repurchased all shares at $88/share ($2.5B valuation).

The money to repurchase shares must be coming from an external source?

I assumed Character.AI wasn’t profitable, like most AI startups.

Absolutely not yet profitable, not even close.

Currently a money furnace.

These two stories are hard to rectify unless the Google licensing deal is a lump sum of several billion dollars. Which feels borderline impossible. Even Microsoft didn’t do that with open AI and the AI trade is cooking very fast.

They raised ~$200M total, and $150M at the series A. So if they're just paying back investors, they'd "only" need $500M.

Yes. Character.ai usage is way down from the peak and it is only getting easier for startups to compete in the space. However, the plausibility of an actual FAANG acquisition is almost zero, so this is the next best option… at least for certain stakeholders. Microsoft did this with Inflection.

What was the peak? I see estimated 211 million visits in June 2024, vs 86 million in Feb 2023.

Visits is an entirely meaningless metric

and conjecture is a better one?

Out of curiosity, where can one find reliable estimates?

This almost seems exactly it, just as the last paragraph of the TechCrunch article hints at.

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