The Fuzzy Math Behind Scale AI’s Valuation

Scale AI’s 27-year-old CEO, Alexandr Wang, used to compete in national high school math competitions. His latest math-related victory may have been convincing investors in Silicon Valley to stretch his own company’s numbers. The startup’s $13.8 billion valuation, from a billion-dollar round it raised in May, is almost certainly too high, whichever formula you use.

The eight-year-old startup mostly handles the low-end work on artificial intelligence that large-language models developers like Alphabet, Meta Platforms and OpenAI don’t want to do. A lot of that work lately has involved hiring people with doctorates or other educated types to sit at their laptops and help those AI models figure out which responses to users’ prompts are best.