Abstract: Stem cells are regarded as a key feature of animal multicellularity. The transcription factors SOX and POU, crucial regulators of pluripotent stem cells, were traditionally thought to be unique innovations of animals. Our research challenges this notion by identifying Sox and POU homologs in the closest unicellular relatives of animals. We found that unicellular SOX proteins bind DNA similarly to mammalian Sox2 and can induce pluripotent stem cells, a capability also exhibited by ancestrally reconstructed Ur-Sox proteins dating back 700 million years. In contrast, unicellular POU proteins have distinct DNA-binding profiles and cannot induce pluripotency. Our findings suggest that the evolution of stem cells utilized pre-existing set of transcription factors, involving significant changes in POU DNA-binding specificity and the exaptation of ancestral interactions with SOX factors. This study expands our understanding of the origins of stem cell-associated transcription factors and illuminates the evolutionary processes that facilitated the transition from unicellular to multicellular life, providing new insights into the molecular foundations of cellular differentiation and regeneration.