AI21 Labs, the Israeli AI startup once valued at $1.4 billion, is cutting more than 60% of its workforce - eliminating approximately 110 of its 180 employees. The remaining 70 staff will focus almost exclusively on the company's AI agent management platform called Maestro.
The restructuring follows collapsed acquisition talks with cloud provider Nebius. Instead of a buyout, the two companies agreed to a commercial partnership worth tens of millions of dollars.
AI21 is discontinuing the sale of its standalone language models entirely, pivoting fully to enterprise agent orchestration. The company has also secured a separate contract with website-building platform Wix, which plans to base parts of its operations on the Maestro platform.
Despite raising roughly $700 million across multiple funding rounds, AI21 is now navigating a dramatically different path. Investors are still hoping for a multi-billion-dollar exit.