Disney has agreed to offer jobs to at least 60 Character.AI employees, representing the majority of the startup's workforce, with an estimated $60 million in annual compensation following the chatbot company's bankruptcy filing. The agreement follows Character.AI's previous announcement that Disney had agreed to acquire some of its assets for $20 million. Legal filings spotted by Bloomberg indicate that the vast majority of Character.AI employees who received job offers from Disney have accepted them, though the arrangement remains a stalking horse bid that could be surpassed by a higher offer from another company.
The bankruptcy filing revealed that Character.AI struggled with high costs as well as potential litigation-related liabilities and regulatory engagement despite maintaining a large and engaged user base. The startup recently faced a lawsuit filed by the mother of a 14-year-old boy who claimed her son became obsessed with one of its chatbots prior to committing suicide, alongside ongoing government investigations concerning child safety concerns. Former Character.AI CEO Karandeep Anand also recently transitioned to become the entertainment giant's first chief technology officer.
This workforce acquisition highlights the shifting talent dynamics within the artificial intelligence sector as early-stage startups face mounting financial and regulatory pressures.