Reid Hoffman Questions Elon Musk's AI Strategy At SpaceX: 'You're A Premium-Priced CoreWeave'

Tech investor and LinkedIn co-founder Reid Hoffman criticized the AI strategy of Space Exploration Technologies Corp. (NASDAQ:SPCX) and the performance of xAI.

Hoffman Doubles Down On SpaceX Critique

In the Pioneers of AI podcast on Tuesday, in conversation with Rana el Kaliouby, Hoffman said that xAI, as Elon Musk himself had described it, was a “complete train wreck” in its efforts to build foundational models and related technologies. He also highlighted that all of xAI’s founders have departed and the company is on its “third restart.”

"SpaceX isn’t an AI company," said Hoffman. His remarks followed SpaceX’s public listing on June 12, where AI was a significant part of its IPO narrative. Shortly after, the company announced its acquisition of Cursor, an AI coding tool. Hoffman saw this as a sign of SpaceX’s AI deficiency rather than an indication of its capability and termed it as using the market cap to “buy AI companies and try to buy your way into relevance."

"You’re a premium-priced CoreWeave (NASDAQ:CRWV)," Hoffman said. "I get it. Which is not an AI company."

SpaceX has been facing financial challenges, losing $1 trillion in a week, yet it managed to raise $20 billion in debt. This suggests a growing divide between equity investors’ and credit investors’ views on Elon Musk‘s latest public company. Notably, CNBC’s Jim Cramer earlier called SpaceX a “meme stock” and compared it to GameStop Corp. (NYSE:GME).

OpenAI, Anthropic Can Both Win

Speaking about other AI companies that could eventually go public, Hoffman expressed concern over the U.S. government’s decision to compel Anthropic to withdraw its Fable and Mythos models from the market, criticizing the lack of a clear, principled rationale behind the move.

Despite being an investor in both Anthropic and OpenAI, Hoffman dismissed the notion that the companies are direct rivals, arguing that the AI market is large enough for both to achieve substantial success.  "There’s a lot of room for both of them to win incredibly,” he said.

Hoffman’s comments come at a time when he has recently left Microsoft Corporation‘s (NASDAQ:MSFT) board to focus on his startup, Manus. He had also departed from OpenAI’s board in 2023 due to potential conflicts of interest with his investments through Greylock Partners and his personal holdings in startups building on OpenAI’s technology.

Meanwhile, OpenAI’s confidential IPO filing has drawn attention after a report revealed a significantly larger loss in 2025. The company’s net loss reportedly widened to about $39 billion in 2025 from $5 billion in 2024, though its adjusted loss excluding restructuring and other non-cash charges was $8 billion. The company spent roughly $34 billion during the year, including $19 billion on research and development and nearly $6 billion on sales, marketing, and other expenses.

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