Snorkel AI Raises $350 Million at $3.5 Billion Valuation Amid AI Data Boom
Snorkel AI, a startup that builds training datasets and simulated environments for AI labs and corporations, raises $350 million in a Series E round at a $3.5 billion valuation. Insight Partners and S32 lead the round, with existing investors Addition, Lightspeed, Greylock, GV, and Wells Fargo also participating. The new valuation nearly triples the $1.3 billion the company earns in its Series D just 17 months earlier.
The company shifts from selling data-labeling software to a data-as-a-service model, delivering completed datasets and reinforcement learning environments to customers. It uses a hybrid approach that combines synthetic data generation with input from subject matter experts. Snorkel says its annualized revenue run rate now stands at $375 million, an eighteenfold increase over the past 12 months, driven by AI labs' insatiable appetite for high-end training data.
Snorkel joins a wave of AI data companies experiencing explosive growth, including Mercor at $2 billion in gross annualized revenue, Handshake at $1 billion, and Micro1 at $500 million. Unlike pure human-expert marketplaces, which pay out 60% to 70% of top-line income to specialists, Snorkel accounts for expert payments in cost of goods sold rather than headline revenue. The startup launches commercially in 2019 after four years of research by co-founder and CEO Alex Ratner and his team at a Stanford AI lab.