Prime Highlights
- Snap’s CTO Bobby Murphy will serve as Dotmo’s lead investor while continuing in his full-time role at Snap overseeing generative AI research and development.
- Snap will receive a large equity stake in Dotmo in exchange for providing talent and a licence to use its technology for gaming and entertainment platforms.
Key Facts
- Snap is the parent company of Snapchat, a social media platform, and has been restructuring through spinoffs and layoffs across 2026.
- Dotmo is a newly formed company focused on developing AI models for interactive gaming and entertainment, founded by former Snap employees.
Background
Snap is separating its internal generative AI video team into a new independent company called Dotmo, which will focus on building AI models for interactive gaming and entertainment experiences. Snap cited the high internal costs of running such operations as a key reason for the move.
Although Dotmo will function as a standalone company, it will maintain close ties with Snap. The new firm will receive a licence to adapt Snap’s technology for gaming and interactive entertainment platforms, and its founding team will consist of current Snap employees who are leaving to launch the venture.
Snap’s Chief Technology Officer Bobby Murphy will act as lead investor in Dotmo, taking a significant personal stake in the company. Murphy will continue in his full-time role at Snap, leading its generative AI research and development efforts. Snap itself will not fund Dotmo directly, but will receive a large equity stake in exchange for the talent and technology licence. Dotmo may also seek outside funding in the future.
The spinoff marks Snap’s second such move this year. Earlier in 2026, the company separated its Specs smart glasses operation into a standalone business. Snap also cut around 1,000 jobs earlier this year.
A Snap representative noted that Dotmo will pursue digital experiences outside the company’s current core priorities, though a future partnership remains possible.
Spin-offs may have various functions for organizations, such as reducing expenses, gaining investors’ attention, and providing more flexibility for employees. The organization reduces its financial risk associated with AI development and earns from its profits by using this mechanism.
