source: techcrunch ai: snap spins off ai video team into new company, dotmo, due to costs
level: business
snap is spinning off its internal generative ai video team into a new company called dotmo. the new venture will develop ai models for interactive gaming experiences. snap said the high costs of running such work internally drove the decision. dotmo will operate as a separate entity but keep close ties to snap. snap will give dotmo a license to adapt its technology for gaming and interactive entertainment. the initial team will come from current snap staff leaving to launch the venture.
snap's chief technology officer bobby murphy will act as lead investor with a significant personal stake. he will continue working full-time at snap and leading its genai research. snap will get a large equity stake in dotmo in exchange for the talent and technology license. dotmo may seek outside funding later. this is snap's second major spinoff this year, following the separation of its specs smart glasses line into a new company. snap also cut around 1,000 jobs earlier in 2026.
a snap representative said dotmo focuses on digital experiences outside snap's core business priorities. it could become a partner if the fit is right. spinoffs can save costs and provide operational flexibility. by spinning out dotmo, snap reduces the financial burden of ai work while keeping exposure to potential gains through its equity stake.
why it matters: shows how companies manage ai development costs through spinoffs while retaining strategic access to technology and talent.
source: techcrunch ai: snap spins off ai video team into new company, dotmo, due to costs