Snorkel AI raises $350M and reaches a $3.5B valuation

In short: Snorkel AI raised $350 million in new funding, valuing the company at $3.5 billion.

What happened

Snorkel AI, a seven-year-old startup, announced a $350 million Series E funding round at a $3.5 billion valuation. The round was led by Insight Partners and S32, with participation from existing investors including Addition, Lightspeed, Greylock, GV, and Wells Fargo.

The company’s valuation is nearly triple what it was 17 months ago, when it raised a $100 million Series D at a $1.3 billion valuation.

Snorkel AI helps companies build “training data” for AI systems. Training data is the practice material an AI learns from, like flashcards for a student. Snorkel also builds simulated environments used for reinforcement learning, which is a way to train AI by letting it learn through trial and error, like practicing in a flight simulator.

Snorkel started by selling software that helped speed up data labeling, meaning tagging information so a computer can learn from it. Last year, it shifted to selling finished datasets as a service. The company says it uses a hybrid approach, combining software-generated synthetic data (made-up data designed to look real) with work from subject matter experts.

Snorkel says its annualized revenue run-rate is now $375 million, and it says that number has grown sharply over the past year.

Why it matters

Better training data often leads to better AI, and many AI teams are running short on high-quality data. Snorkel’s fast growth and higher valuation suggest that investors believe the market for packaged training datasets and realistic simulations will keep expanding.

Source: TechCrunch AI