Just when you thought circular trading couldn’t get any more circular, OpenAI invested in CEO Sam Altman’s brain computer interface (BCI) startup Merge Labs.
Merge Labs, which defines itself as a “research institute” dedicated to “bridging biological and artificial intelligence to maximize human potential,” came out of stealth on Thursday with an undisclosed seed round. A person familiar with the matter confirmed earlier reports that OpenAI wrote the largest check in Merge Labs’ $250 million seed round at a valuation of $850 million.
“Our personal experience of the world arises from billions of active neurons,” a statement from Merge Labs says. “If we can interface with these neurons at scale, we could restore lost abilities, support healthier brain states, deepen our connections with each other, and expand what we can imagine and create with advanced AI.”
Merge Labs said it intends to achieve these feats non-invasively by developing “an entirely new technology that uses molecules instead of electrodes to connect to neurons” and “sends and receives information using deep-reaching modalities like ultrasound.”
The move deepens the competition between Altman and Elon Musk. Musk’s startup Neuralink is also developing computer interface chips that allow people suffering from severe paralysis to control devices with their thoughts. Neuralink currently requires invasive surgery for implantation. In this surgery, a surgical robot removes a small piece of the skull and inserts tiny electrode threads into the brain to read nerve signals. The company last raised a $650 million Series E in June 2025 at a valuation of $9 billion.
While BCI undoubtedly has medical applications, Merge Labs seems focused on using the technology to realize Silicon Valley’s fantasy of combining human biology and AI to give superhuman abilities.
“Brain-computer interfaces (BCIs) are an important new frontier,” OpenAI wrote in a blog post. “These open up new ways to communicate, learn, and interact with technology. BCI creates a natural, human-centered way for anyone to seamlessly interact with AI. This is why OpenAI is participating in Merge Labs’ seed round.”
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Other co-founders include Alex Blania (CEO) and Sandro Herbig (product and engineering lead) of Tools for Humanity, another Altman-backed company (creator of the eye-scanning World Orb). Tyson Afflalo and Sumner Norman, co-founders of embedded neural technology company Forest Neurotech. and Mikhail Shapiro, a researcher at the California Institute of Technology.
Branier and Helbig said in their respective social media posts that they will continue in their roles with Tools for Humanity. Merge Labs would not confirm whether Alfalo and Norman would retain their positions at Forest Neurotech, saying only that the company would continue to operate and have a “great working relationship” with Merge. Mr. Shapiro plans to continue teaching at Caltech.
A spokesperson told TechCrunch that the co-founders are also members of Merge Labs’ board of directors.
As part of the agreement, OpenAI will collaborate with Merge Labs on scientific foundational models and other frontier tools to “accelerate progress.” OpenAI said in a blog post that AI will not only help accelerate research and development in biotechnology, neuroscience, and device engineering, but will also benefit from interfaces in AI operating systems that can “interpret intent, adapt to individuals, and operate reliably even with limited and noisy signals.”
In other words, Merge Labs could act as a remote control for OpenAI software. This leads to the cyclical nature of this transaction. If Merge Labs is successful, it could drive more users to OpenAI and justify OpenAI’s investment in the company. Leveraging the resources of Altman’s company also increases the value of Altman’s startup.
OpenAI is also working with Jony Ive’s startup io, which it acquired last year, to develop screen-agnostic AI hardware. Recent unconfirmed leaks suggest that the device could be earphones.
OpenAI invests primarily through the OpenAI Startup Fund. The OpenAI Startup Fund has invested in several other startups associated with Altman, including Red Queen Bio, Rain AI, and Harvey. OpenAI also has commercial deals with startups that Altman personally owns or chairs, including fusion startup Helion Energy and nuclear fission company Oklo.
Altman has been dreaming about the “merge,” or the idea of humans and machines merging, at least since 2017, when he published a blog post speculating that it would happen somewhere between 2025 and 2075. He also speculated that this merging could take various forms, including plugging electrons into our brains and becoming “really close friends with chatbots.”
He said a merger would be the “best-case scenario” for humanity to survive against super-intelligent AI, saying AI is a separate species in conflict with humans.
“The merger has already begun, but it’s about to get even stranger,” Altman wrote. “We will be the first species in history to design our own descendants. My guess is that we will either become a biological bootloader of digital intelligence and fade into a branch of the evolutionary tree, or we will be able to understand what a successful merge looks like.”
TechCrunch reached out to OpenAI and Merge Labs for more information.
This article has been updated to confirm that Merge Labs’ founders will continue working at their respective companies.
