Meta is reportedly in the talks for a multibillion-dollar investment in Scale AI. This investment could exceed $10 billion, making it the company’s largest external investment.
Scale AI provides data labeling services to companies such as Microsoft and OpenAI to help them train their AI models. Much of that labeling work is done by contractors. Recently, the company also began enlisting PhDs, nurses and other experts with advanced degrees to help develop more sophisticated models.
Scale AI CEO Alexandr Wang rose to prominence three months after the Chinese AI company DeepSeek disrupted the tech world with its cost-effective and efficient AI model, when he appeared on Capitol Hill to urge policymakers to act to maintain U.S. dominance.
READ: Amid surging energy demands from AI and data centers, Big Tech turns to nuclear power (November 29, 2024)
The U.S., Wang said at the April hearing, needs to establish a “national AI data reserve,” supply enough power for data centers and avoid an onerous patchwork of state-level rules. Lawmakers welcomed his feedback. “It’s good to see you again here in Washington,” Republican Representative Neal Dunn of Florida said. “You’re becoming a regular up here.”
As of 2024, Scale AI was valued at about $14 billion, with Meta among the backers in the funding round. Meta had previously invested in Scale AI’s most recent $1 billion Series F funding round. Scale generated $870 million in sales last year and expects sales to more than double to $2 billion in 2025, according to Bloomberg. Meta has also previously worked with Scale to help train its Llama large language models, as well as to develop a “Defense Llama” AI model focused on U.S. national security.
This comes during a time when the Facebook parent company has been consistently investing heavily in generative AI. In April, CEO Mark Zuckerberg told investors that the company planned to spend about $68 billion in capital expenditures this year, up from $39.2 billion 2024. The investment is focused on developing AI infrastructure such as data centers with advanced processors from Nvidia.
The data centers power the training and operation of Meta’s Llama AI models, which it is publishing for developers to use as open-source code. Meta expects that this investment would improve user engagement and stronger advertising tools for Facebook, Instagram and its other apps.
According to a Wall Street Journal report, Meta plans to incorporate generative AI into its advertising offering to offer fully automated marketing plans by next year.
Meta also recently struck a 20-year deal with nuclear plant Constellation Energy to power its AI initiatives. According to the deal, Meta would buy all power produced in Constellation’s plant in Clinton, Illinois, for a 20-year period beginning 2027. This is reportedly the first time a company signed a deal to buy all energy from a single nuclear plant, though Constellation had entered into a similar but a stripped-down agreement with Microsoft in 2024 to reopen a Pennsylvania plant. While the financial terms of the deal are yet to be disclosed, Constellation CEO Joseph Dominguez said “billions of dollars of capital that you’re signing up for to run a plant for 20 more years.”