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Instead of signing expensive contracts with companies for their data, AI labs these days are trying a new tack: tapping former senior employees from those companies for their industry knowledge, Mercor CEO Brendan Foody said at TechCrunch Disrupt 2025<\/a> on Tuesday.<\/p>\n Speaking on a panel onstage, Foody cast Mercor\u2019s marketplace as one of the main channels connecting the former employees of investment banks, consulting houses, and law firms with AI labs that are looking to automate those industries. Some of Mercor\u2019s customers include OpenAI, Anthropic, and Meta.<\/p>\n \u201cThere is an argument that Goldman Sachs doesn\u2019t love the idea of having models that are able to automate their value chain,\u201d said Foody, using the Wall Street giant as an example. \u201cIt definitely shifts the competitive dynamics, and that\u2019s part of the reason that the labs need us. Their customers don\u2019t want to give them data to automate large portions of their value chains, so they need to hire contractors who previously worked at those companies, understand those workflows, and are willing to train models to automate them.\u201d<\/p>\n Foody, the 22-year-old co-founder of Mercor, says his startup pays industry experts up to $200 an hour to fill out forms and write reports for AI training. The company now has tens of thousands of contractors and says it doles out more than $1.5 million to them every day. Still, Foody says the startup remains profitable because AI labs are willing to pay even more for that valuable data.<\/p>\n In just under three years since its inception, Mercor has increased its annualized recurring revenue to roughly $500 million, and recently raised funding at a $10 billion valuation.<\/a><\/p>\n Incumbents across the economy have good reason to be resistant to Mercor\u2019s rise, as their industry\u2019s knowledge may be slipping out the back door through former employees on the startup\u2019s marketplace, which could ultimately be used to automate their work. Foody acknowledged he may be exposing an inefficiency in the market but said he wouldn\u2019t call it a \u201cloophole.\u201d<\/p>\n In fact, Foody says some companies are already embracing this \u201cnew future of work.\u201d He entertained the idea that Mercor\u2019s marketplace could create a new type of gig economy, much like Uber did more than a decade ago. (Earlier this year, Uber\u2019s former chief product officer, Sundeep Jain, joined Mercor as president.)<\/p>\n Techcrunch event<\/p>\n \n\t\t\t\t\t\t\t\t\tSan Francisco<\/span> \u201cThere are companies that are embracing it and realize that the world is going to change very quickly,\u201d said Foody. \u201cThere\u2019s definitely another category of companies that are fearful, and worry about being dis-intermediated, and having their customers go directly to the AI labs or application layer platforms. My hunch is that the former category is going to turn out to be on the right side of history.\u201d<\/p>\n While Mercor tries to extract knowledge from various industries, Foody said his startup tries to prevent contractors from committing corporate espionage \u2014 the illegal act of stealing proprietary information, trade secrets, or intellectual property from one business and selling it to another.<\/p>\n But that\u2019s easier said than done. Most of Mercor\u2019s workforce are former employees of law firms, investment banks, and other industries that are very secretive about their data. Foody said some of Mercor\u2019s contractors still work at their day jobs and just submit data on the side, and he claimed that contractors are instructed not to upload documents from their former workplace. Still, he acknowledged that it\u2019s possible \u201cthere are things that happen\u201d given the scale of his startup.<\/p>\n Foody argues that the knowledge in an employee\u2019s head belongs to the employee, and not their company \u2014 a more generous view than many enterprises would take. Plus, in some of Mercor\u2019s job postings, the startup walks the line between requesting an employee\u2019s knowledge and their company\u2019s data.<\/p>\n For example, Mercor is currently looking for the CTO or co-founder of a startup<\/a> who \u201ccan authorize\u00a0access to a substantial, production codebase\u201d for AI evaluations, or potentially AI model training. In an email, Mercor told TechCrunch that a few startup CTOs have taken them up on this offer but declined to disclose details of their contracts.<\/p>\n Mercor was one of the first data startups to recruit highly skilled knowledge workers in the U.S. and pay them large sums to train AI models. Early in the AI boom, data vendors like Scale AI hired contractors in third-world countries to do fairly simple labeling jobs. Now, most of Mercor\u2019s competitors \u2014 including Surge and Scale AI \u2014 have caught on that AI labs need experts to improve their AI models. Many data vendors have also started training \u201cenvironments<\/a>\u201d to improve AI agents\u2019 ability to complete real-world tasks.<\/p>\n Mercor has clearly benefited from Scale AI\u2019s misfortunes: Many AI labs stopped working with<\/a> Scale AI after Meta made a large investment in the startup and hired its CEO. In the last year, Mercor has quintupled its value<\/a>, but it still remains smaller than Surge and Scale AI, which are both valued at upward of $20 billion.<\/p>\n Today, most of Mercor\u2019s revenue comes from just a few AI labs, but Foody says the startup plans to partner with other industries in the future. He believes companies in law, finance, and medicine will want help leveraging their data to train AI agents \u2014 something Mercor specializes in.<\/p>\n \u201cOver time, ChatGPT will be better than the best consulting firm, better than the best investment bank, and better than the best law firm,\u201d said Foody. \u201cThat\u2019s going to transform the economy radically, which will be a broadly positive force that helps to create abundance for everyone.\u201d<\/p>\n<\/div>\n
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