Driverless cars may be years away from being practical, but a key independent supplier of software to the self-driving vehicle industry, Scale, is having a breakout moment with investors as its business booms.
The company is nearing the completion of a new round of financing led by Founders Fund, the venture firm co-founded by Peter Thiel, that values Scale at around $1 billion, according to two people familiar with the deal. That’s a big jump from its $90 million valuation in a funding round last year, according to PitchBook. Scale’s software helps self-driving vehicle developers train their computer vision algorithms to identify objects on the road, a process known as data annotation.
Unlike most self-driving vehicle developers, nearly all of which are in early testing phases, Scale is already generating revenue. The company’s annual recurring revenue—which reflects customer commitments to buy its services over the next 12 months—has jumped to $40 million from $4 million over the past year, according to one of these people. While the size of the round couldn’t be learned, Founders Fund is expected to invest around $50 million into the San Francisco–based company, according to one of the people. A spokeswoman for Founders Fund said the firm “declined to comment on rumors and speculation.”