AI training startup Mercor is in talks to raise a round at a valuation of $20 billion, people told Bloomberg. This is a significant increase from its previous valuation in October, when it raised $350 million in Series C at a $10 billion valuation.
The outlet noted that discussions regarding this latest round are in the early stages, but reported that Melkor has told investors it has already received a term sheet at the new valuation. The report comes as founder and CEO Brendan Foudy told X that the company's annual revenue run rate exceeded $2 billion, a 100% increase from just four months ago.
Melkor announced Thursday that it will acquire Deeptune, a company that helps train AI agents. According to a press release, the entire Deeptune team will join Mercor as part of the acquisition. Earnings numbers, acquisitions, and the possibility of new funding suggest Melkor may be past its early 2026 difficulties. Earlier this year, Business Insider reported that the company suffered a data breach and several contract employees filed suit.