Character.AI lays off at least 5% of its workforce to refocus on personalized AI

Chatbot startup Character.AI has laid off at least 5% of its workforce has laid off around 5% of its workforce, according to a report from The Information. This decision is part of a broader effort by the company to streamline operations and focus more on personalized AI development.

Citing a note to employees, The Information added that the layoffs primarily affected employees in marketing and recruiting roles.

A spokesperson from Character.AI confirmed the restructuring to Reuters, emphasizing the company’s commitment to aligning all positions with its renewed focus on personalized AI products. However, they did not specify the exact number of employees impacted.

“At least 5% of Character’s roughly 120 employees were cut, according to a person briefed by company leaders. Those employees mostly worked on marketing and recruiting,” The Information reported, citing the source.

The news of the layoff comes just two months after the buzziest generative AI startup saw a surge in popularity, with 1.7 million downloads during the first week of its beta launch, which even led to a waiting list for new users.

Character.AI, the chatbot maker whose co-founders were rehired by Google as part of a deal earlier this month, laid off staff on Thursday, according to a note to employees viewed by The Information.

Character.AI entered into a deal with Alphabet’s Google, granting the tech giant a non-exclusive license to the startup’s large language model technology. As part of this agreement, Character.AI will receive additional funding from Google, though the specific amount was not disclosed.

Character.AI co-founders Noam Shazeer and Daniel De Freitas were also rehired by Google as part of the deal. The two ex-Google engineers returned to DeepMind as part of the new partnership  The news came just three years after the duo left the search giant to launch their own generative AI startup.

Character.AI has previously secured $193 million in venture capital from investors like Andreessen Horowitz and was reportedly in discussions to raise further funding from Google.

Founded in September 2022 by Noam Shazeer and Daniel De Freitas, Character.AI offers an innovative platform that allows users to have realistic conversations with characters from fiction, history, or even original creations. The app uses a neural language model to generate responses based on user inputs, and it provides a space for anyone to create their own character, whether fictional or based on real people.

Character.AI co-founders Noam Shazeer and Daniel De Freitas