Matan Grinberg, co-founder and CEO of the AI coding startup Factory, said in a post on X on Wednesday that he fired VC Chris Degnan from his role as a board adviser. Grinberg alleges that Degnan shared confidential information with Factory’s biggest competitor, Cognition.
Two hours after Grinberg’s post, Degnan announced on both X and LinkedIn that he had joined Cognition as its chief revenue officer. He also subsequently refuted Grinberg’s allegations, saying in a separate X post that he wasn’t fired but resigned when he told Grinberg he was taking the job.
Three-year-old, San Francisco-based Factory is an agentic coding startup whose AI agents can carry out programming tasks largely on their own. The company raised 5 billion valuation this month from Khosla Ventures, Blackstone, Sequoia Capital, Insight Partners, and others.
Grinberg said he sees Cognition, the maker of the Devin coding agent, as his biggest competitor. Cognition raised another 48 billion valuation earlier this month.
Grinberg said Degnan had earlier acknowledged having a “casual” conversation with a Cognition executive but had assured Grinberg that he had no interest in working for the competitor. On Monday, however, Degnan apparently disclosed that he had actually been in ongoing talks with Cognition.
Khosla Ventures is an investor in both Cognition and Factory. Vinod Khosla accused Grinberg of lying about firing Degnan. Keith Rabois opined that interviewing at a competitor while attending board meetings is unethical.