Inside Scale AI’s Business After Meta’s Bombshell $14 Billion Deal Daily Cover Story Inside Scale AI’s Business After Meta’s Bombshell $14 B
<p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;"><span style="font-weight: 700;">Alexandr Wang walked</span> down the staircase to the open atrium at Scale AI headquarters in San Francisco last June, employees didn’t know if he was still their boss. A day earlier, the data labeling company had announced a bombshell deal: Meta was acquiring 49% of Scale for $14 billion, and its founder CEO was leaving to lead Mark Zuckerberg’s newly-formed superintelligence lab. Amid a swirl of confusion, many Scale employees thought he had already left. So, surprised to see him, the workers applauded as he headed to the stage for the company all-hands. “I literally teared up,” Wang tells <em>Forbes</em> now. “In another life, I'd be so excited to continue at Scale.”</p><p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; min-height: 1lh; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;">He doesn’t remember exactly what he told them at the meeting, but according to one person in attendance, Wang began by recounting how he’d started building Scale as a freshman at MIT, then started to cry. “This is so stupid. Why am I doing this?” the person recalled him saying.</p><p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; min-height: 1lh; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;">Wang’s remark was in reference to his tears, but it seemed like an apt question to apply to the entire situation. In the wake of the surprise deal, which had leaked a few days earlier, all of Silicon Valley was similarly asking: Why was Wang giving up his own growing company, then worth $13.8 billion, to go work for Meta, which was playing catch-up in AI to Google, OpenAI and Anthropic?</p><p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; min-height: 1lh; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;">Scale had been a powerhouse in the market of human data, where armies of clickworkers and experts — like PhDs, lawyers and engineers — generate data to train cutting edge AI models like Google’s Gemini and OpenAI’s ChatGPT. Scale had also become a go-to vendor for the Department of War since it first brought large language models to the Pentagon in 2020. And the operation had, for a moment, turned Wang into the <a href="https://www.forbes.com/sites/colehorton/2022/05/25/the-new-youngest-self-made-billionaire-in-the-world-is-a-25-year-old-college-dropout/" target="_self" class="color-link" title="https://www.forbes.com/sites/colehorton/2022/05/25/the-new-youngest-self-made-billionaire-in-the-world-is-a-25-year-old-college-dropout/" data-ga-track="InternalLink:https://www.forbes.com/sites/colehorton/2022/05/25/the-new-youngest-self-made-billionaire-in-the-world-is-a-25-year-old-college-dropout/" aria-label="world’s youngest self-made billionaire" style="color: rgb(59, 120, 216); cursor: pointer; text-decoration: none; background-color: rgba(0, 0, 0, 0);">world’s youngest self-made billionaire</a>. Now the tie-up with Meta threatened to railroad what had become a stalwart business providing infrastructure to the most valuable companies in AI. After all, the thinking went, what frontier lab would want to entrust its data to a company almost half-owned by Meta?</p><div style="color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif; font-size: 18px; min-height: 0px;"></div><p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; min-height: 1lh; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;">Wang, who took roughly ten Scale employees with him to Meta, says now that it was an “incredible opportunity” for both companies. The other half of the all-hands meeting was Wang formally introducing his successor Jason Droege, previously Scale’s chief strategy officer, and before that an executive at Uber and Axon, the company that makes the Taser gun. Despite all the drama of the previous week, the meeting itself was a tight 30 minutes, with no Q&A from employees. Instead, Wang and Droege kept it quick. “We shake hands, give each other a hug, say we're both excited about our futures,” recalls Droege. “And then the next moment, we've got to go do it.” (Droege still holds the “interim” CEO title, but internally he’s seen as its long-term leader.)</p><blockquote class="embed-base quote-embed embed-45 bg-accent color-base font-accent font-size text-align" style="margin: 1.6rem 0px 19px; position: relative; clear: both; font-family: Highlander, "Times New Roman", serif; width: 700px; background-color: rgb(255, 255, 255); color: rgb(24, 23, 22); font-size: 18px; padding: 30px !important; border: 0px !important;"><p style="overflow: hidden; text-overflow: ellipsis; background-color: inherit; font-size: 24px; font-weight: 600; line-height: 1.25; color: inherit; margin: 0px !important;">“We definitely anticipated turbulence. There's no question. I mean, the facts of the situation are, our founder went to another lab to help them.”</p><footer class="text-align" style="overflow: hidden; text-overflow: ellipsis; font-size: 16px; margin-top: 1.6rem; position: relative; color: inherit;">Jason Droege, CEO, Scale</footer></blockquote><div class="article_paragraph_7" style="margin: 0px; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif; font-size: 18px;"></div><p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; min-height: 1lh; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;">Almost one year on from the deal announcement — and a decade after its founding in May 2016 — Scale unsurprisingly looks like a much different company. Droege’s first order of business as CEO was to shift the company’s investment away from the data labeling business, and toward a model where it helps large enterprise companies, like Ernst & Young, Paramount and Cisco, as well as public sector clients, like the U.S. military, to develop their own internal AI applications.</p><p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; min-height: 1lh; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;">The strategy appears to have paid off. Scale tells <em>Forbes</em> it tallied just shy of $1 billion in revenue last year, up from <a href="https://www.bloomberg.com/news/articles/2025-04-02/scale-ai-expects-to-more-than-double-sales-to-2-billion-in-2025" rel="nofollow noopener noreferrer" target="_blank" class="color-link" title="https://www.bloomberg.com/news/articles/2025-04-02/scale-ai-expects-to-more-than-double-sales-to-2-billion-in-2025" data-ga-track="ExternalLink:https://www.bloomberg.com/news/articles/2025-04-02/scale-ai-expects-to-more-than-double-sales-to-2-billion-in-2025" aria-label="$870 million the year before" style="color: rgb(59, 120, 216); cursor: pointer; text-decoration: none; background-color: rgba(0, 0, 0, 0);">$870 million the year before</a>. (Throughout the entire history of the company, it has brought in $2.5 billion in revenue.) Part of the revenue growth could be a lot of help from its new shareholder Meta: As part of the arrangement, Meta agreed to pay Scale at least $450 million a year for five years for its services, or more than half of its annual AI spend, whichever is less, <em>Forbes </em><a href="https://www.forbes.com/sites/davidjeans/2025/06/13/scale-ai-meta-spend/" target="_self" class="color-link" title="https://www.forbes.com/sites/davidjeans/2025/06/13/scale-ai-meta-spend/" data-ga-track="InternalLink:https://www.forbes.com/sites/davidjeans/2025/06/13/scale-ai-meta-spend/" aria-label="reported" style="color: rgb(59, 120, 216); cursor: pointer; text-decoration: none; background-color: rgba(0, 0, 0, 0);">reported</a> at the time. Wang and Droege declined to comment, but it would represent nearly half of Scale’s annual revenue.</p><div style="color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif; font-size: 18px; min-height: 0px;"></div><p style="margin: 1.2rem 0px; font-size: 18px; line-height: 30px; min-height: 1lh; color: rgb(51, 51, 51); font-family: Georgia, Cambria, "Times New Roman", Times, serif;">Droege also declined to break down the split between the data and apps business. He says data labeling is still the “vast majority” of revenue, but he expects revenue from the app business to overtake the data business within the next 18 months. Meanwhile, Wang, now at Meta, is still rooting for the company he cofounded. “There's this perception that Scale is cooked or done or whatnot, and that's just absolutely not true,” says Wang, calling the company’s resilience a “huge narrative violation.”</p>