Why Mercor's $20 Billion Valuation Doesn't Add Up

Mercor pays doctors, lawyers, and software engineers real money to check AI chatbot answers and record themselves solving problems the models can learn from. Tens of thousands of people do this work every week.

The same company built around these workers is reportedly negotiating a $500 million raise at a $20 billion valuation, according to Bloomberg and Forbes. That's double what Mercor was worth nine months ago, when it raised $350 million at a $10 billion valuation led by Felicis Ventures.

One number is doing most of the work behind that jump. Mercor is said to have generated roughly $2 billion in revenue this year, according to the research firm Sacra, but it hasn't. That $2 billion is gross payment volume, the same kind of number Uber reports when it says it processed $20 billion worth of rides. It counts everything customers paid into the platform, not what Mercor actually kept.

So how much of that $2 billion does Mercor actually keep? And why are investors negotiating this price four months after a breach serious enough to make Meta walk away entirely, one that exposed contractor biometric data and interview recordings stored on Mercor's own systems? 

MORE INSIGHTS ON THIS TOPIC:

• Workers Sue $10B AI Startup Mercor Over Alleged Data Collection and Exposure
• $10B AI Hiring Startup Mercor Confirms Data Breach Affecting Tech Talent
• LinkedIn is Testing an “AI Labor Marketplace” to Rival Mercor and Scale AI

The gross revenue illusion

According to Sacra, contractors keep 60% to 70% of every dollar that runs through Mercor. On a $10 payment for one AI answer checked by a real doctor or lawyer, roughly $6 to $7 goes to the contractor, and Mercor keeps $3 to $4.