Data-labeling startup Scale AI raises $1B as valuation doubles to $13.8B

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Scale AI, which supplies data-labeling providers to corporations that wish to prepare machine studying fashions, has raised a $1 billion Sequence F spherical from a slew of big-name institutional and company buyers that embody Amazon and Meta.

The fundraise is a mixture of major and secondary funding, and is the most recent in a slew of huge enterprise capital investments in AI. Amazon lately closed a $4 billion funding in OpenAI rival Anthropic, and the likes of Mistral AI and Perplexity are additionally within the technique of elevating extra billion-dollar rounds at lofty valuations.

Earlier than this spherical, Scale AI had raised round $600 million in its eight-year historical past, together with a $325 million Sequence E in 2021 that valued it at round $7 billion — double the valuation of its Sequence D in 2020. Three years on, and regardless of headwinds that brought about it to put off 20% of its workers final yr, Scale AI is now valued at $13.8 billion — an indication of the instances, as buyers scramble to get forward within the AI gold rush.

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The Sequence F was led by Accel, which additionally led the corporate’s Sequence A and took part in subsequent enterprise rounds.

Except for Amazon and Meta, Scale AI has attracted an assortment of recent buyers: the enterprise arms of Cisco, Intel, AMD and ServiceNow participated, as did DFJ Development, WCM and investor Elad Gil. A lot of its current buyers additionally returned: Nvidia, Coatue, Y Combinator (YC), Index Ventures, Founders Fund, Tiger International Administration, Thrive Capital, Spark Capital, Greenoaks, Wellington Administration, and former GitHub CEO, Nat Friedman.

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Banking on the rising significance of knowledge

Knowledge is the lifeblood of synthetic intelligence, which is why corporations specializing in knowledge administration and processing are faring properly proper now. Simply final week, Weka stated it raised $140 million at a $1.6 billion post-money valuation to assist corporations construct knowledge pipelines for his or her AI functions.

Based in 2016, Scale AI meshes machine studying with ‘human-in-the-loop’ oversight to handle and annotate giant volumes of knowledge, which is important for coaching AI methods throughout industries resembling autonomous automobiles.

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However most knowledge is unstructured, and AI methods discover it troublesome to make use of such knowledge off the bat. It must be labeled, which is a resource-intensive endeavor, particularly with giant knowledge units. Scale AI supplies corporations with knowledge that has been appropriately annotated and primed for coaching fashions. It additionally specializes for various industries with completely different wants — a self-driving automobile firm will possible want labeled knowledge from cameras and Lidar, whereas pure language processing (NLP) use-cases will want annotated textual content.

The corporate’s clients embody Microsoft, Toyota, GM, Meta, the U.S. Division of Protection and, as of final August, ChatGPT-maker OpenAI, which is tapping Scale AI to let corporations fine-tune its GPT-3.5 text-generating fashions.

Scale AI says it is going to use the brand new money to assist speed up the “abundance of frontier knowledge that can pave our highway to synthetic basic intelligence.”

“Knowledge abundance is just not the default — it’s a alternative,” Scale AI’s CEO and founder, Alexandr Wang, stated in a press launch. “It requires bringing collectively the perfect minds in engineering, operations, and AI. Our imaginative and prescient is one in all knowledge abundance, the place we’ve got the technique of manufacturing to proceed scaling frontier LLMs many extra orders of magnitude. We shouldn’t be data-constrained in attending to GPT-10.”

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