Mercor, a leading AI training startup, is reportedly in discussions to secure funding at a $20 billion valuation. This potential valuation marks a significant leap from its previous $10 billion valuation achieved during a $350 million Series C funding round in October 2025.
According to sources, these discussions are in the early stages. However, Mercor has indicated to investors that it has already received a term sheet reflecting the new valuation. This development coincides with CEO Brendan Foody’s recent announcement that the company’s annualized revenue run rate has surpassed $2 billion, doubling from four months prior.
In a strategic move to bolster its capabilities, Mercor has acquired Deeptune, a company specializing in training AI agents. The entire Deeptune team will integrate into Mercor as part of this acquisition, aiming to enhance Mercor’s AI training services.
These advancements suggest that Mercor is overcoming earlier challenges faced in 2026, including a data breach linked to the compromise of the open-source project LiteLLM. The breach reportedly exposed sensitive data, including candidate profiles and source code. Additionally, the company faced legal actions from several contract workers.
Founded in 2023, Mercor has rapidly ascended in the AI industry by connecting companies with domain experts essential for training foundational AI models. Its client roster includes major AI labs such as OpenAI and Meta. The company’s growth trajectory underscores the escalating demand for specialized AI training services and the pivotal role Mercor plays in this sector.
Mercor’s swift valuation increase and strategic acquisition highlight the company’s robust position in the AI training market. As the demand for AI expertise continues to surge, Mercor’s ability to adapt and expand its services will be crucial in maintaining its competitive edge and meeting the evolving needs of the industry.
