Factory CEO Accuses New Cognition CRO Chris Degnan of Sharing Secrets
Factory CEO Matan Grinberg accuses adviser Chris Degnan of sharing secrets with Cognition, as Degnan denies wrongdoing and joins the AI rival as its CRO.
Summary
Factory cofounder and CEO Matan Grinberg said on September 30, 2026, that he fired board adviser Chris Degnan on Tuesday for allegedly sharing confidential information with Cognition, Factory’s biggest competitor. Two hours later, Degnan became Cognition’s chief revenue officer. Grinberg said Degnan initially characterized contact with Cognition as casual and denied interest in joining, then disclosed ongoing talks on Monday. He said Degnan’s board access, confidentiality obligations, and questions about Factory’s product roadmap and parity gap raised concerns. Degnan denies sharing information, says he resigned Monday, and says his last board meeting preceded any Cognition contact by weeks. He also claims Grinberg offered him a full time Factory job, which he declined.
Degnan was Snowflake’s first sales hire and chief revenue officer for 11 years. He joined Factory investor RPT Partners five months ago and has advised Iconiq startups since October 2025. His announcement said RPT and managing partner Chad Peets will work with Cognition. Three year old San Francisco startup Factory raised $200 million at a $5 billion valuation in September from Khosla Ventures, Blackstone, Sequoia Capital, Insight Partners and others. Customers include Nvidia, Blackstone, Royal Bank of Canada, Palo Alto Networks, Adobe and T-Mobile. Devin maker Cognition raised $2 billion at a $48 billion valuation that month and serves Mercedes-Benz, NASA, Goldman Sachs and Citi.
Khosla Ventures has backed both companies, including Cognition since at least early 2025. Vinod Khosla accused Grinberg of lying and called Factory a struggling second tier competitor; Grinberg said he has undisclosed email evidence. Partner Keith Rabois called interviewing with a competitor while retaining board access unethical. Andreessen Horowitz reportedly faces a Justice Department probe over partners serving on competitors’ boards. Degnan, Peets, Factory and Khosla Ventures did not immediately comment further.
Positives
- Factory raised $200 million at a $5 billion valuation in September from Khosla Ventures, Blackstone, Sequoia Capital, Insight Partners and others.
- Cognition raised $2 billion at a $48 billion valuation in September, giving the Devin developer substantial expansion capital.
- Factory serves Nvidia, Blackstone, Royal Bank of Canada, Palo Alto Networks, Adobe and T-Mobile.
- Cognition counts Mercedes-Benz, NASA, Goldman Sachs and Citi among its customers.
- Chris Degnan brings Cognition 11 years of experience as Snowflake’s chief revenue officer.
Risks & concerns
- Matan Grinberg alleges Chris Degnan shared confidential Factory information while advising its board and discussing employment with Cognition.
- Factory does not know what information Degnan may have disclosed, leaving the alleged exposure unresolved.
- Degnan disputes being fired, denies sharing secrets and says his Factory board attendance ended weeks before Cognition contact.
- Khosla Ventures backs both Factory and Cognition, exposing tensions around venture investors supporting direct AI competitors.
- Andreessen Horowitz reportedly faces a Justice Department probe into partners serving on competitors’ boards, highlighting possible regulatory consequences.
