Handshake, an AI data-labeling startup, has successfully acquired Cleanlab, a company specializing in data label auditing, as confirmed by both firms to TechCrunch.
Founded in 2013, Handshake initially served as a platform for recruiting college graduates and recently ventured into human data labeling to support foundational AI model developers. Cleanlab, established in 2021, focuses on enhancing the quality of data generated by human labelers through innovative software solutions.
This acquisition primarily aims to strengthen Handshake's talent pool, incorporating nine essential Cleanlab team members into its research division. Notably, the co-founders, who hold PhDs in computer science from MIT, are part of this transition. The financial details of the deal remain undisclosed, although previous reports suggest that such acqui-hires can be quite rewarding for founders.
Cleanlab has successfully raised $30 million from notable investors, including Menlo Ventures and Bain Capital Ventures, and at its peak, boasted over 30 employees.
The team at Cleanlab excels in creating algorithms that automatically identify erroneous data without requiring a second human review. Their expertise is expected to significantly enhance the quality of data that Handshake supplies to AI labs.
According to Sahil Bhaiwala, Handshake's Chief Strategy and Innovation Officer, the company has a dedicated research team that continuously evaluates the weaknesses in their models and the quality of the data they produce. "The Cleanlab team has been focusing on this problem for years," he stated.
Northcutt, Cleanlab's CEO known for innovating automated data-labeling audits, revealed that the company had received acquisition offers from various AI data-labeling firms. However, they opted for Handshake due to its reputation as a reliable source of human experts for data-labeling projects.
Handshake, valued at $3.3 billion in 2022, is projected to achieve an annualized revenue run rate of $300 million by the end of 2025 and is reportedly on track to reach a revenue range in the high hundreds of millions this year. The company has been instrumental in providing data for leading AI labs, including OpenAI.