Mercor quintuples valuation to $10B with $350M Series C

Mercor, which connects AI labs with domain experts to train their foundational AI models, has raised $350 million at a $10 billion valuation, the company confirmed to TechCrunch.

Felicis Ventures, which led the previous $100 million Series B at a $2 billion valuation, is also leading this round. Existing investors Benchmark and General Catalyst, and new investor Robinhood Ventures also participated.

TechCrunch reported in September that Mercor was in talks with investors to raise a Series C at a $10 billion valuation, up from its $8 billion target a few months earlier. The company told potential investors at the time that it already had several offers.

Mercor started as an AI-driven recruitment platform, but quickly pivoted to offering companies specialized domain experts to conduct AI model training – such as scientists, doctors and lawyers – and charging an hourly wage and an associated rate for their work.

The company has also added more software infrastructure for reinforcement learning – a training method in which a model or agent’s decisions are verified or challenged, allowing feedback to be absorbed and improved over time. The company plans to eventually build an AI-powered recruiting marketplace.

Mercor’s fortunes rose after reportedly running AI labs such as OpenAI and Google DeepMind cut ties with data labeling startup Scale AI after Meta invested $14 billion in the data provider and hired its CEO.

The company has apparently told investors that it is on track to reach $500 million in ARR faster than Anysphere, the startup behind Cursor, which reached the milestone about a year after launching its core product.

“Since we founded Mercor nearly three years ago, AI has evolved at an astonishing pace. But it still struggles with the subtleties that drive economically valuable work: making trade-offs, understanding intentions, developing tastes, and deciding what needs to be done, not just what can be done,” the company wrote in an emailed blog post to TechCrunch.

The startup says it currently pays more than $1.5 million per day to its contractors. It employs more than 30,000 experts, who pay an average of more than $85 per hour.

Mercor said it will focus on three areas: expanding its talent network, improving its systems for matching its contractors with customers, and building new products to automate more of its processes.