AI data-labeling startup Handshake has acquired data label-auditing startup Cleanlab, the companies told TechCrunch.

Handshake started in 2013 as a platform for hiring college graduates and launched a human data-labeling business about a year ago to serve foundational AI model companies. Cleanlab, founded in 2021, is a startup that provides software for improving the quality of data generated by human labels.

The purpose of the deal is the first acquisition of talent, aka an acqui-hire, adding nine key Cleanlab employees to Handshake’s research organization. This includes the startup’s co-founders, who earned their PhDs in computer science from MIT: Curtis Northcutt (pictured above), Jonas Mueller, and Anish Athalye. Terms of the transaction were not disclosed (although, as we previously reported, sometimes an acqui-hire can be surprisingly profitable for founders.)

Cleanlab has raised a total of $30 million from investors, including Menlo Ventures, TQ Ventures, Bain Capital Ventures, and Databricks Ventures. At its peak, the startup had more than 30 employees.

Cleanlab researchers are experts in developing algorithms that flag erroneous data without a second human checker. The goal is to improve the quality of data generated by Handshake for AI labs.

“We have an in-house research team that is thinking very hard about where our models are weak, what data do we need to build on? How high is the quality of that data?” Sahil Bhaiwala, chief strategy and innovation officer at Handshake told TechCrunch. “The Cleanlab team has been focusing on this problem for years.”

Northcutt, the CEO of Cleanlab who is credited with pioneering the automated audit of labeling data, said the company has received interest in acquiring from other AI data labeling companies. But the startup chose to sell to Handshake because, he said, data labeling competitors, including Mercor, Surge, and Scale AI, often use Handshake’s platform to get human experts like doctors, lawyers, and scientists for their data labeling projects.

“If you choose one, you should choose the source, not the middleman,” Northcutt told TechCrunch.

Handshake, which was last valued at $3.3 billion in 2022, is projected to end 2025 at $300 million in annualized revenue run rate (ARR) and IS reported on track to reach ARR in the “high hundreds of millions” this year. The company provides data for eight leading AI labs, including OpenAI.