AI startup Micro1 wants to challenge Google's winning bid for Spirit Airlines data with a higher offer
· Business Insider
GIORGIO VIERA / AFP via Getty Images
- Micro1 says it's making an offer "materially higher" than Google's for Spirit Airlines' data.
- The AI startup told the airline it will pay $12.5 million for its data.
- Bankruptcy experts say overturning the deal is possible, but a long shot.
Another AI company wants to get its hands on Spirit Airlines' data.
Visit biznow.biz for more information.
Ali Ansari, 25, the founder and CEO of Micro1, a startup that helps train AI models, told Business Insider that his firm is making a "materially higher" offer for Spirit Airlines' data after Google successfully bid $10 million for it this week.
Micro1 sent a $12.5 million offer to Spirit Airlines' legal team on Wednesday, a person familiar with the matter said.
Spirit Airlines is selling off its assets in bankruptcy court — including troves of corporate data — after going under last year.
Bankruptcy experts told Business Insider it would be unusual — but not out of the question — for the court to consider Micro1's offer after it missed the deadline to bid in the original auction.
Ansari said Micro1's interest reflects the value of company data for training AI models, as it contains the kind of messy inputs that help AI models learn to operate in real-world environments.
"Realistic data is very valuable," he said, calling Google's winning bid "actually quite low" given Spirit Airlines' decades of operation. Micro1 pays other companies up to $2 million for their data.
Based in San Francisco, Micro1 pays gig workers to improve AI models for its clients, and runs digital 'environments' where AI agents can get better at tasks like booking train tickets. Founded in 2022, it has about 150 employees and has fielded offers at a $2.5 billion valuation, Forbes reported in December.
Micro1 CEO Ali Ansari.Micro1
AI training startups are scrambling to acquire data from companies to supercharge their clients' chatbots. Mercor, another AI training startup, also bid for the Spirit Airlines data, sparking a bidding war with Google, which initially bit $5 million. Mercor's final bid of $7.5 million lost to Google's $10 million.
Google, Spirit Airlines, and Mercor declined to comment on Micro1's last-minute move. A representative for Spirit Airlines' creditors committee didn't respond to requests for comment.
Whether Micro1 can actually disrupt Google's deal isn't clear.
Bankruptcy law professors told Business Insider that judges sometimes entertain late bids if they could generate significantly more money for creditors and shareholders, or offer other terms that those parties find more favorable.
At the same time, courts also want to preserve the integrity of the original auction process.
"A duly noticed, well-run auction generally won't get undone," Nancy Rapoport, a law professor at the University of Nevada, Las Vegas, said. "The higher bidder had the opportunity to bid during the auction."
Lindsey Simon, an associate law professor at Emory University, said it often comes down to the judge overseeing the case.
"The bankruptcy code isn't clear on this," she said.
The federal bankruptcy court in New York has not yet approved the auction results.
On Tuesday, it delayed a hearing on the auction after a group of former Spirit Airlines' flight attendants objected over concerns about what would happen to their data.
Google previously told Business Insider that any data it receives will be "rigorously scrubbed" of any personally identifiable information by a third party.
A hearing for the data sale will be held on September 9. Ansari said Micro1 is working on submitting details about its offer to the court.
Have a tip? Contact Charles via email at [email protected] or on Signal and WhatsApp at 628-282-2811. Use a personal email address, a nonwork WiFi network, and a nonwork device; here's our guide to sharing information securely.
Read the original article on Business Insider