Can Mercor, Co-founded by Adarsh Hiremath, Surya Midha and Brendan Foody, Compete Against LinkedIn

AI-powered job placement platform Mercor, co-founded by three high school friends and college drop-outs, valued at $2 billion

(Photo: Adarsh Hiremath, Brendan Foody and Surya Midha, from left. Mercor.)

February 23, 2025

It has been roughly two years since the promise of artificial intelligence (AI) tools was enthusiastically welcomed by thousands of businesses and hundreds of millions of consumers around the world. This followed the introduction of large language model based ChatGPT, by OpenAI in November 2022. Among a wide range of benefits, use of such AI tools was forecast to boost the profits of many businesses, through higher productivity due to automation of coding, content creation, customer support, and numerous other tasks.

Profits from the use and sales of AI-based tools, products and services are not yet evident at most big companies, including the global technology companies, who are spending billions of dollars on computer chips, power, and related infrastructure.

Some startups, which use ChatGPT and other large language models, are seeing rapid and profitable revenue growth. Among them is Mercor, a San Francisco, United States, based online job recruiting company, which has an annual revenue run rate of $75 million and is profitable. “Mercor is training models that predict how well someone will perform on a job better than a human can,” co-founder and chief executive Brendan Foody told CNBC last week.

Foody spoke about the startup raising $100 million in a new round of funding. The fund raise was reportedly at a valuation of $2 billion, 8x higher than the $250 million valuation during the previous funding round just five months ago. The company raised the funds “to solve the hardest problem in capitalism: matching human ability to its greatest use,” according to a statement.

Mercor uses an AI talent prediction model to understand a job applicant’s skills, experiences, and strengths. Then it seeks to place them with companies looking for the exact background and abilities.

Mercor’s pitch to job applicants is “Join the thousands of candidates around the world
using Mercor to land their remote dream job with just a single application.” Jobs currently listed on Mercor’s landing page include: Senior Software Engineer, Hourly, Remote, $210 per hour; and Legal Intelligence Analyst, Hourly, Remote, $90 per hour. Apparently, most of Mercor’s current recruiting is for remote, short-term jobs paid by the hour.

“When hiring someone for 5 years, it’s easier to interview them manually. When hiring someone for 5 weeks, efficient matching automation creates a huge comparative advantage,” notes a Mercor blog post. “Because of this, we’ve started with shorter duration contract work, but will expand progressively towards longer duration, full-time jobs as our technology matures.”

So far more than 300,000 professionals have sought short-term jobs through Mercor’s platform. The platform enables candidates to interview remotely from wherever they are and get placed in jobs anywhere in the world. It also offers candidates training for job interviews as well as the ability to prove they can solve complex problems in their area of expertise, which is of interest to potential employers.

Mercor enables employers to browse, select, and hire candidates all on the same day. The platform sources, vets, and pays recruited employees. Mercor does not identify its clients, stating generically that they are “companies predominantly in Silicon Valley.” The clients can pay the employee through Mercor or directly. Mercor charges a recruiting fee, “typically equal to 30%” of the annual wages paid to an employee.

Mercor was co-founded by Brendan Foody, Adarsh Hiremath, chief technology officer, and Surya Midha, chief operations officer. All three are 22-years-old who dropped out of college to found the startup. In 2024, they received Thiel fellowships which are “for young people who want to build new things…(and who) skip or stop out of college to receive a $100,000 grant and support from the Thiel Foundation’s network of founders, investors, and scientists.”

The fellowship were established in 2011 by Peter Thiel, co-founder of Palantir, PayPal and other businesses, who has a net worth of $18 billion according to Forbes. Thiel earned a Bachelor of Arts/Science from Stanford and a JD from Stanford Law School.

Besides Hiremath and Midha, other Indians, among the 20 Thiel fellows last year, were: Govind Gnanakumar, of Folsom, California; his Automorphic is creating AI models that learn new information more efficiently than humans. Tarun Amasa, of New York City; his Endex is building the first autonomous and super-intelligent financial analyst. And Yash Patil of Austin, Texas, an OpenAI research engineer evaluating language models and creating systems for machines to collaborate with less human oversight.

Foody attended Georgetown University, 2021-2023, but did not finish his BBA in Economics and Business Administration. Hiremath studied computer science and machine learning at Harvard. “At Harvard, I spent my time taking CS classes, conducting ML research, and thinking about macroeconomics as a research assistant to Larry Summers,” former U.S. Treasury Secretary and a professor, Hiremath writes in a post on LinkedIn.

In 2023, “During my sophomore year, I co-founded Mercor in my dorm room. Convinced that labor aggregation was the greatest opportunity of the 21st century, I dropped out of Harvard, moved to San Francisco…”

Midha did not complete his B.S. in Foreign Service from Georgetown. Midha, Hiremath and Foody were on the policy debate team at the Bellarmine College Preparatory, an all-boys Jesuit school in San Jose, California, where they finished high school.

“I stumbled around for two years in a college designed to train diplomats, mostly taking courses in international relations, math, and economics,” Midha writes in a blog on his website. “During college, I was an Assistant Debate Coach at Bellarmine, Intern to Eswar Prasad in the Global Economy and Development Program at the Brookings Institution, and Research Assistant to Caitlin Talmadge in the Security Studies Program at Georgetown.”

“My parents immigrated to the US from New Delhi, India. I was born in Mountain View and raised in San Jose, California.”

Investors in Mercor include Peter Thiel, Larry Summers, Jack Dorsey, co-founder of X/Twitter and Block, and San Francisco based venture firm General Catalyst, led by Hemant Taneja, which manages $32 billion.

Mercor was founded, states a company blog, “because the labor market is the largest, most inefficient market in the world. Better matching people with the work they do everyday is the largest lever on maximizing global utility. While we gained incredible traction with our initial focus on hiring experts to train AI models, this is only the first step in our plan to solve global labor allocation.”

Mercor says that it has a major competitive advantage given its ability to attract a global pool of top-quality job-seeking candidates and the continuous analysis of data it accumulates from applications, interviews, and job placements. But the job recruiting market is a crowded field with several competitors, ranging from single person operations and firms focused on finding senior managers to large companies recruiting thousands like Indeed and LinkedIn.

Indeed, which is part of Japan’s Recruit Holding, “has multiple AI tools to help recruiters track applications, create job descriptions and reduce the amount of time it takes to identify quality candidates.”

LinkedIn, which is part of Microsoft, has one billion users. In fiscal year 2024, LinkedIn had roughly $17 billion in revenues, with about half of it from talent solutions, which includes job recruitment.

Microsoft, based in Redmond, Washington, and with a market value of $3 trillion, has invested about $14 billion in OpenAI, the creator of ChatGPT tools. It is also investing billions to develop its own AI tools, products, and services for all its business units. Already, LinkedIn’s Recruiter platform is using AI tools to enable companies to “hire the right people with advanced search filters and intelligent matching.”

Given Microsoft’s talent pool, market size, access to data, and massive investments, LinkedIn can develop a far superior AI-based recruiting platform than Mercor and other startups. The investors in Mercor must be aware of this. But large companies, especially in the technology fields, can stumble and be displaced by agile small competitors. Also, it is likely that investors in Mercor anticipate that, in a worst case scenario, the rapidly growing will likely be bought by Microsoft or another major company, seeking to expand its customer base and/or snuff out an upcoming rival.

“Throughout history, many of humanity’s great minds took a while to find their calling. Jeff Bezos (founder of Amazon, which has a market value $2.3 trillion) started as a hedge fund investor,” states a blog post on Mercor’s site. “Walt Disney was fired as a newspaper editor for ‘lacking creativity.’ Before becoming a priest, Pope Francis worked as a nightclub bouncer. (Yes, really.)”

Reed Hastings (founder of Netflix, market value $429 billion) was a teacher, states another blog post on Mercor’s site. “That was the world we lived in, not so long ago. These are the jobs they were doing before they found the best use for their talents.”
”In each case, greatness was unlocked by the right person ending up in the right place at the right time. But, tragically, many never do.”

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