Scale AI raises $1B, valuation doubles to $13.8B
Data-labeling startup Scale AI, co-founded and led by Alexandr Wang, has secured a $1 billion Series F round from prominent institutional and corporate investors, including Amazon and Meta. This funding round, involving both primary and secondary funding, underscores the ongoing excitement in the AI sector. Recently, Amazon also invested $4 billion in Anthropic, while Mistral AI and Perplexity are raising substantial rounds at high valuations.
Scale AI’s valuation has now soared to $13.8 billion, a significant milestone considering its previous fundraising achievements. Before this round, the company had raised around $600 million, including a notable $325 million Series E in 2021, which valued it at around $7 billion. This doubling of valuation is seen as a sign of investors’ eagerness to gain an edge in the competitive AI industry.
Leading the Series F was Accel, a long-time investor of Scale AI, having participated in several previous rounds. In addition to Amazon and Meta, the round attracted new investors such as the venture arms of Cisco, Intel, AMD, and ServiceNow. Other returning backers included Nvidia, Coatue, Y Combinator, Index Ventures, Founders Fund, Tiger Global Management, Thrive Capital, Spark Capital, Greenoaks, Wellington Management, and former GitHub CEO Nat Friedman.
The importance of data in AI development cannot be understated, with companies specializing in data processing seeing substantial support. Just recently, Weka raised $140 million at a $1.6 billion valuation for developing data pipelines essential for AI applications.
Founded in 2016, Scale AI combines machine learning with human oversight to manage and annotate vast datasets, a crucial step for training AI systems across various industries like autonomous vehicles. Most data is unstructured and requires extensive labeling, a service Scale AI specializes in, ensuring the data is ready for model training. Their diverse clientele includes Microsoft, Toyota, GM, Meta, the U.S. Department of Defense, and OpenAI.
Scale AI intends to use this new funding to accelerate the development of “frontier data” necessary for achieving artificial general intelligence. CEO Alexandr Wang highlighted the importance of producing abundant data to facilitate advancements in large language models (LLMs), envisioning a future where data constraints are no longer a barrier.
Source: Data-labeling startup Scale AI raises $1B as valuation doubles to $13.8B.
