At xAI's Palo Alto headquarters, engineers cheered.

It was February 2, and they'd just received a memo from Elon Musk, informing them the AI startup would be acquired by his rocket company, SpaceX. In a Slack channel for the team that trains the company's chatbot Grok, memes flowed, and a few changed their profile pictures to depict themselves as astronauts.

The excitement was quickly overshadowed by the pressure building inside the startup racing to catch up with rivals like OpenAI and Anthropic, while preparing for an expected IPO.

Over the past six months, Musk has become deeply involved in day-to-day operations. He's run a massive group chat that's active at all hours, directed product changes, reassigned engineers, cut staff on key teams, and launched intensive "war rooms" to accelerate development. Several current and former employees said that the level of involvement has altered how the company functions. Leadership roles have narrowed, projects have shifted quickly, and teams have been pushed into what one described as a constant "fire drill."

Musk said that the changes are necessary as the company scales and the team's lean structure will be the secret to its success. Discussing xAI's restructure following the SpaceX acquisition, he posted on X:

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