Nvidia Weighs Investment in Round Valuing Mercor at $20 Billion

Nvidia is considering investing in Mercor, a data labeling provider that supplies data crucial for the chip designer's open-source models, according to The Information. The potential investment would value Mercor at $20 billion, although the exact size of the investment and the total funding round remain undisclosed. Mercor's revenue from Nvidia has been on the rise as the company develops its Nemotron open-source models, earning tens of millions of dollars from Nvidia in the last quarter, as reported.

Nvidia also collaborates with Turing and Scale, having previously invested in Scale's 2024 funding round, valuing the company at $14 billion. Mercor, valued at $10 billion during an October Series C funding round raising $350 million, has seen its valuation increase fivefold since its Series B round. The company's CEO, Brendan Foody, emphasized the importance of their talent network in training frontier AI models, highlighting the unique aspect of knowledge, experience, and context sharing.

In April, Mercor faced seven class-action lawsuits following a data breach, with allegations of exposing contractor information, including job interview recordings, facial biometric data, and screenshots of employees' computers. Mercor dismissed the lawsuits as speculative and expressed readiness to present the facts. Nvidia recently announced a partnership with six financial institutions to establish independent compute platforms, aiming to mobilize over $500 billion of third-party capital for AI infrastructure development.