Full Breakdown
Factory AI and Cognition Clash Over Executive Hire
By Drooid · · How we work
Feud Over Executive Hire Escalates
Factory AI and Cognition, two San Francisco AI-coding startups, entered a public dispute after Factory’s board observer and former Snowflake chief revenue officer Chris Degnan announced he would join Cognition as chief revenue officer. Factory CEO Matan Grinberg said on X that Factory terminated Degnan’s role upon learning he had been holding “recurring conversations” with Cognition executives while advising Factory on confidential matters. Grinberg also alleged that Cognition employees posed as job candidates to extract internal information from Factory.
Background: AI Coding Startup Competition
Both firms are racing to commercialize autonomous software-engineering agents. Factory markets a platform for deploying AI agents across development pipelines, while Cognition is known for Devin, an AI coding agent that automates engineering tasks. The rivalry intensified after each announced major funding rounds: Factory raised $200 million at a $5 billion valuation, and Cognition secured more than $2 billion at a $48 billion valuation earlier in the month.
Official Statements & Responses
Cognition CEO Scott Wu rejected Grinberg’s claim that Cognition staff pretended to be job candidates, stating the company would never direct engineers to collect competitor data “under-the-table.”
Verbatim Quotes
- “It feels as though ethics is being thrown out of the window in the AI era,” — Matan Grinberg, factory CEO
- “Cognition has never asked about information on Factory, nor would I ever give it,” — Chris Degnan