{"id":3097,"date":"2026-07-09T18:45:08","date_gmt":"2026-07-09T18:45:08","guid":{"rendered":"https:\/\/crosscountrymovingteams.com\/?p=3097"},"modified":"2026-07-09T18:45:08","modified_gmt":"2026-07-09T18:45:08","slug":"ai-unicorn-mercor-acquires-deeptune-after-founder-brendan-foody-backed-the-startup","status":"publish","type":"post","link":"https:\/\/crosscountrymovingteams.com\/?p=3097","title":{"rendered":"AI unicorn Mercor acquires Deeptune after founder Brendan Foody backed the startup"},"content":{"rendered":"
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Deeptune, an Andreessen Horowitz-backed startup, builds simulation environments where AI agents practice real-world tasks before touching production systems\u2014think a flight simulator, but for AI agents learning how to use Excel, Salesforce, and Slack. Financial terms weren\u2019t disclosed. And according to Mercor, Deeptune\u2019s team will joining Mercor\u2019s team in New York.<\/p>\n

Read more This year\u2019s El Ni\u00f1o is not \u2018run-of-the-mill\u2019\u2014and it could rival one that killed 23,000<\/a><\/p>\n

Foody was listed as an angel investor in Deeptune\u2019s $43 million Series A just three months before the acquisition closed. Foody told me the angel check was written with acquisition already in mind: \u201cIt was in a lot of ways the main motivation, actually.\u201d Call it relationship-building or call it a strategic hold. Either way, a16z funded Foody\u2019s future acquisition target, and Foody got a front-row seat before making his move.<\/p>\n

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The deal is also a direct answer to where the AI training market is heading. Frontier labs (and Mercor customers) like Anthropic and OpenAI now need full digital replicas of enterprise software environments where their agents can practice, fail, and learn. Mercor\u2019s network of more than five million domain experts already builds the tasks and scoring rubrics that tell a model whether it did the job right. Deeptune builds the apps those tasks run inside. Together, they cover the full stack.<\/p>\n

Foody claims Mercor is already the market leader in building these so-called reinforcement learning environments\u2014and that all of the Mag Seven except Tesla are customers. The company hit $2 billion in ARR in June, up from $1 billion last year. Foody described the jump as \u201cthe fastest growth trajectory ever\u201d from $1 million to $2 billion ARR in 24 months.<\/p>\n

Mercor\u2019s acquisition comes on the heels of a massive data breach in March. Hackers exploited a supply chain vulnerability in LiteLLM\u2014an open-source Python library widely used to build AI tools\u2014and exfiltrated an estimated four terabytes of Mercor\u2019s data. This allegedly included tax and banking data, passport scans, interview recordings, facial biometrics, and internal records, according to a class action filed in April against Mercor in California. In June, Mercor said that only a very limited subset of sensitive information was affected and there is no evidence that the data has been used fraudulently. The hacking group Lapsus$ claimed responsibility and offered the data for sale on Telegram.\u00a0<\/p>\n

Foody spoke about the breach like a thing of the past, with the confidence of someone whose customers already voted with their wallets: \u201cEvery frontier lab has expanded their relationship with us since the data breach,\u201d he claimed. \u201cThe business grew from a $1 billion revenue run rate to $2 billion in ARR in the last four months.\u201d<\/p>\n

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That\u2019s either a remarkable display of customer loyalty or a reminder that Frontier Labs has nowhere else to go at this scale.\u00a0<\/p>\n

See you tomorrow,<\/p>\n

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@LilyMaeLazarus
lily.lazarus@fortune.com
Submit a deal for the Term Sheet newsletter\u00a0here.<\/p>\n

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Joey Abrams curated the deals section of today\u2019s newsletter.<\/em> Subscribe here.<\/p>\n

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VENTURE DEALS<\/h3>\n

– <\/span>Kaon<\/b> AI<\/b>, a San Francisco-based generative AI platform and research lab focused on interactive entertainment, raised $60 million in funding from <\/span>B<\/b> Capital<\/b>, <\/span>Redpoint<\/b> Ace<\/b>, <\/span>Goodwater<\/b> Capital<\/b>, and <\/span>DCM<\/b>.<\/span><\/p>\n

– <\/span>Vendelux<\/b>, a New York City-based AI-powered business-to-business event marketing platform, raised $50 million in Series B funding. <\/span>Tribeca<\/b> Venture<\/b> Partners<\/b> led the round and was joined by <\/span>S3<\/b>, <\/span>Pelion<\/b> Ventures<\/b>, <\/span>HubSpot<\/b> Ventures<\/b>, and others.<\/span><\/p>\n

– <\/span>Alta<\/b>, a Tel Aviv, Israel-based AI system designed for go to market teams, raised $25 million in Series A funding. <\/span>IN<\/b> Venture<\/b> led the round and was joined by <\/span>Mindset<\/b> Ventures<\/b>, <\/span>Skywell<\/b> Capital<\/b>, <\/span>LeumiTech77<\/b>, and existing investors.<\/span><\/p>\n

– <\/span>Axle<\/b> Energy<\/b>, a London, U.K.-based company that turns EV chargers, batteries, and heat pumps into grid-balancing capacity, raised $25 million in Series A funding. <\/span>Energize<\/b> Capital<\/b> led the round and was joined by existing investors <\/span>Accel<\/b>, <\/span>Picus<\/b> Capital<\/b>, and <\/span>Eka<\/b> Ventures<\/b>.<\/span><\/p>\n

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– <\/span>Fleek<\/b>, a London, U.K.-based developer of AI infrastructure for the secondhand clothing industry, raised $25 million in Series B funding. <\/span>Burda<\/b> Principal<\/b> Investments led the round and was joined by <\/span>eBay<\/b>, <\/span>FJ<\/b> Labs<\/b>, <\/span>H14<\/b>, and existing investors.<\/span><\/p>\n

– <\/span>EdVisorly<\/b>, a Los Angeles, Calif.-based AI platform for college enrollment and admissions, raised $13.3 million in Series A funding. <\/span>Breachway<\/b> Capital<\/b> led the round and was joined by <\/span>U.S. News & World Report<\/b>, <\/span>Lumina<\/b> Foundation<\/b>, <\/span>Strada<\/b> Education<\/b> Foundation<\/b>, and others.<\/span><\/p>\n

– <\/span>geoSurge<\/b>, a London, U.K.-based AI startup that builds data infrastructure for brand visibility in generative AI systems, raised $12 million in seed funding. AlbionVC led the round and was joined by Play Ventures, Octopus Ventures, Celero Ventures, Boost Capital, and<\/span><\/p>\n

Read more Self-made multimillionaire says Canadians \u2018give no money away\u2019 compared with Americans\u2014research shows U.S. giving is more than twice as high<\/a><\/p>\n

– <\/span>Hakimo<\/b>, a Menlo Park, Calif.-based AI physical security monitoring company, raised $12 million in funding. <\/span>Zigg<\/b> Capital<\/b> led the round and was joined by<\/span> Neotribe Ventures<\/b>, <\/span>Vertex Ventures<\/b>, <\/span>Defy.vc<\/b>, and <\/span>Rocketship.vc<\/b>.<\/span><\/p>\n

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– <\/span>Emesent<\/b>, a Milton, Australia-based autonomous mapping and robotics company, raised $10 million in funding from <\/span>Main<\/b> Sequence<\/b>, <\/span>QIC<\/b> Ventures<\/b>, <\/span>Orion<\/b> Resource<\/b> Partners<\/b>, <\/span>Hostplus<\/b>, and <\/span>NGS<\/b> Super<\/b>.<\/span><\/p>\n

– <\/span>Kord<\/b>, a London, U.K.-based fintech startup focused on identity verification and payment processing, raised \u00a36.4 million in Series A funding. <\/span>Guinness<\/b> Ventures<\/b> led the round and was joined by <\/span>Beringea<\/b>, <\/span>SFC<\/b> Capital<\/b>, and angel investors.<\/span><\/p>\n

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– <\/span>Savi<\/b> Security<\/b>, a Los Angeles, Calif.-based app designed to protect users from AI scams, raised $7 million in seed funding. <\/span>Acrew<\/b> Capital<\/b> led the round and was joined by <\/span>Magnify<\/b> Ventures<\/b>, <\/span>TTCER<\/b>, and <\/span>Resolute<\/b> Ventures<\/b>.<\/span><\/p>\n

– <\/span>Pixel-Flo<\/b>, a Sheffield, U.K.-based MicroLED display manufacturing company, raised \u00a35.3 million in seed funding. Northern Gritstone led the round and was joined by <\/span>SCVC<\/b>, the <\/span>Parkwalk Northern Universities Venture Fund<\/b>, and <\/span>HTGF<\/b>.<\/span><\/p>\n

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PRIVATE EQUITY<\/h3>\n

– <\/span>Bregal<\/b> Sagemount<\/b> acquired a majority stake in <\/span>Pandion<\/b> Optimization<\/b> Alliance<\/b>, a Fairport, N.Y.-based group purchasing organization. Financial terms were not disclosed.\u00a0<\/span><\/p>\n

– <\/span>Capitol<\/b> Meridian<\/b> Partners<\/b> acquired <\/span>Westway<\/b> Enterprises<\/b>, a Herndon, Va.-based classified workspace company. Financial terms were not disclosed.<\/span><\/p>\n

– <\/span>Recognize<\/b> acquired a majority stake in <\/span>Smartlink<\/b>, an Annapolis, Md.-based digital infrastructure services company. Financial terms were not disclosed.<\/span><\/p>\n

FUNDS + FUNDS OF FUNDS<\/h3>\n

– <\/span>Paradigm<\/b>, a San Francisco-based venture capital firm, raised $1.2 billion for its fourth fund focused on AI robotics, space, and other tech companies.<\/span>
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– <\/span>Skynight Capital<\/b>, a Burlingame, Calif. and New York City-based private equity firm, raised $2 billion for its fifth fund focused on health care, financial services, and tech-enabled services companies.\u00a0<\/span><\/p>\n

PEOPLE<\/h3>\n

– <\/span>Grishin Robotics<\/b>, a Menlo Park, Calif.-based venture capital firm, promoted <\/span>Elias<\/b> Can<\/b> to Partner.<\/span><\/p>\n

– <\/span>Highland<\/b> Europe<\/b>, a London, U.K. and Geneva, Switzerland-based private equity company, promoted <\/span>Jacob<\/b> Bernstein<\/b> to Partner.<\/span><\/p>\n

– <\/span>Singular<\/b>, a Paris, France and London, U.K.-based venture capital firm, appointed <\/span>Laura<\/b> McGinnis<\/b> as Partner. Previously, she was with <\/span>Balderton<\/b> Capital<\/b>.<\/span><\/p>\n

Read more \u2018Sony essentially destroys its own defense\u2019: How its disc-free PS5 plan triggered a $457M lawsuit and\u00a0 undercut its antitrust defense<\/a><\/p>\n

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The acquisition comes as Mercor says it reached $2 billion in annual recurring revenue despite a high-profile cybersecurity breach in March.<\/p>\n","protected":false},"author":1,"featured_media":3096,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[],"class_list":["post-3097","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-term-sheet"],"yoast_head":"\nAI unicorn Mercor acquires Deeptune after founder Brendan Foody backed the startup - Cross Country Moving Team<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/crosscountrymovingteams.com\/?p=3097\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"AI unicorn Mercor acquires Deeptune after founder Brendan Foody backed the startup - 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