Micro1, a three-year-old startup that helps AI companies find and manage human contractors for data tagging and training, has raised $35 million in Series A funds, valuing the company’s $500 million. The round is led by O1 Advisors, a venture capital firm founded by Dick Costolo and former CEO and COO of Twitter Adam Bain.
The startup is one of many companies looking to fill the gap in data markets created by changes in scale AI. After the investment $14 billion On the AI scale, and employed its CEO, including OpenAI and OpenAI and Google Say they plan Cut contact With this startup, I probably worry that their research may eventually be mastered in Yuanzhong. (Proportional AI deny As part of its partnership, it shares confidential information with META.
However, AI labs still need these data services, and startups like Micro1 aim to get Slack.
Microsoft 1 CEO Ali Ansari (only 24) told TechCrunch that his company has been working with leading AI labs including Microsoft, as well as several Fortune 100 companies. Ansari said Micro1 is now generating $50 million in annual recurring revenue (ARR), up from $7 million in early 2025.
This is still far from the calls of larger competitors like Mercor, which is producing More than $450 million Arr and Surge reported USD 1.2 billion in 2024. However, Micro1’s growth and adoption in AI labs appear to be growing at a healthy rate.
As part of the new funding, Micro1 also added Bain to its board of directors along with Joshua Browder, founder and CEO of AI legal assistant Donotpay.
“In fact, the model is the only way to learn through net new human data. Micro1 is the core of providing data to the full boundary lab, moving at a speed I’ve never seen before,” Bain said in a statement from TechCrunch.
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Before Reuters Report details Micro1’s fundraising work.
All of these companies (Micro1, Surge, Mercor and Scalial AI) offer AI labs that have access to a large number of human contractors who can tag and generate data for AI training. Companies like Openai, Anthropic, Meta and Google need to build cutting-edge AI models, which has become a crucial service.
Scale AI first dominated the space, with the initial insight that for low-skill contractors around the world, it paid fewer payments to help tag data train AI models. However, Ansari said that the demand for AI labs has changed in recent years and now companies need to improve their AI models from high-quality data labels from field experts such as senior software engineers, doctors and professional writers. The hard part becomes recruiting these types of people.
This led Micro1 to establish its AI recruiter Zara, which interviewed and reviewed candidates as one of the company’s contractors or Ansari calls it an expert. Micro1 said Zara has recruited thousands of experts — including professors from Stanford and Harvard — and the company plans to add hundreds per week.
The market for AI training data seems to have changed again. Many AI labs are now interested in developing “environments” with startups – virtual workspaces can be used to train AI agents for simulation tasks. Ansari said Micro1 is building new products in the environmental space to meet this demand.
Fortunately, for startups like Micro1, AI Labs appear to be working with multiple training data providers. The nature of the business makes it difficult for any company to meet all data needs of AI labs. This means at least there are a lot of businesses to be resolved.
