Mercor, a fast-growing startup that connects top companies such as OpenAI, Meta, Amazon, and Microsoft with domain experts to train and refine AI models, is currently in talks with investors for a Series C funding round.
According to sources, the company is targeting a valuation of $10 billion, up from an earlier $8 billion target. Returning investor Felicis is said to be considering doubling down on its stake, although it has declined to comment. Mercor has reportedly received multiple offers, with some venture capitalists valuing it at as much as $10 billion.
Founded in 2022, the company has witnessed rapid revenue growth, with its annualized run-rate revenue climbing to about $450 million. In February, it announced a $100 million Series B round at a $2 billion valuation, also led by Felicis.
Unlike many of its competitors, Mercor is already profitable, recording $6 million in profit in the first half of the year, according to Forbes. Its model revolves around supplying highly specialized experts such as scientists, doctors, and lawyers to AI firms for model training, charging both a finder’s fee and an hourly matching rate.
The startup claims to provide contractors to five of the world’s leading AI labs, with a significant portion of its revenue coming from clients like OpenAI. To diversify, Mercor is expanding into reinforcement learning software infrastructure, which allows AI models to improve by incorporating feedback. The firm also plans to launch an AI-powered recruiting marketplace. Despite its growth, Mercor faces competition from Surge AI, Scale AI, and Turing Labs, all of which are making similar pushes into reinforcement learning.
Co-founded by Thiel Fellows and Harvard dropouts Brendan Foody, Adarsh Hiremath, and Surya Midha — all still in their early twenties — Mercor has recently bolstered its leadership by appointing former Uber executive Sundeep Jain as its first president.
However, the company’s rise has not been without controversy, as it is currently facing a lawsuit from rival Scale AI over alleged misappropriation of trade secrets. Still, with strong investor interest and increasing revenue, Mercor is positioning itself as a key player in the high-stakes AI services industr