Social Capital AI Startup Deal Led Palihapitiya to Fire Partners

Venture capital firm Social Capital suddenly fired two of its partners after they tried to raise outside money for an artificial intelligence startup — an endeavor that provoked the ire of the firm’s leader, high-profile investor Chamath Palihapitiya.

After it fired Jay Zaveri and Ravi Tanuku on Sunday, the firm offered no details other than that high-wattage law firm Wachtell, Lipton, Rosen & Katz had been hired just days earlier to investigate a “situation,” Bloomberg first reported.

Social Capital’s shocking decision to fire the two partners, and the mystery surrounding the circumstances, has transfixed Silicon Valley this ...