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Another AI Startup, Scale AI, Laid off 20% Workforce, More Layoffs to Come in 2023

The number of affected workers is not yet disclosed but would be over 100 given its 450+ workforce.

Scale AI, a startup using artificial intelligence and software to label text, images, voice, and video data for machine learning, recently laid off over 20% of its workforce. The announcement was made by Alexandr Wang, Founder, and CEO of Scale AI, in a blog post saying that the layoff is one of the many steps the company is taking to ensure the long-term success and profitability of the business.

Scale AI is a Sanfrancisco-based startup backed by renowned venture capitalists like Tiger Global, Founders Fund, and Caotue Management. The seven-year-old company started by providing labeled data required to train machine learning models for the development of robotaxis, self-driving trucks, and automated bots used in warehouses and on-demand deliveries, and subsequently for their commercialization.

He said, “I made the decision to grow the team aggressively in order to take advantage of what I thought was our new normal.” He added that extensive hiring was successful when the world shifted online in 2020 and 2021. But once the pandemic got over, the market changed, and the company had not predicted the extent. 

Read More: Amidst Ongoing Massive Layoffs, Salesforce Plans to Cut Staff by 10%

Apparently, many bigger companies like Amazon and Meta have provided a near-similar reason for laying off a significant number of their employees in the last few months.

Wang said he takes full responsibility as Scale AI laid off the workforce and said employees would be paid eight weeks of severance and three months of healthcare. The company will also pay one-year tenure equity and provide immigration support for outstation employees.

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Disha Chopra
Disha Chopra
Disha Chopra is a content enthusiast! She is an Economics graduate pursuing her PG in the same field along with Data Sciences. Disha enjoys the ever-demanding world of content and the flexibility that comes with it. She can be found listening to music or simply asleep when not working!


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