Scale AI is cutting 200 employees and 500 contractors, about 14% of its workforce, as it restructures operations, Bloomberg reported on Wednesday.
Meta engaged the CEO of Scale AI in a $14.3 billion deal, and the cuts were implemented just one month later.
Interim CEO Jason Droege informed staff in a memo obtained by Bloomberg that Scale AI had expanded its primary data-labeling business too rapidly. This business provided labeled, structured data to AI labs to train AI models.
Droege stated in the memo that Scale AI would increase its staffing near its enterprise and government sales units.
Like other AI firms that have been reverse-acquired, such as Inflection, Scale AI must now pivot from the business that has established it as a leader.
Several of Scale AI’s main data customers severed their relationship with the startup in response to Meta’s investment.