Lucy Guo’s second act: After leaving Scale AI at 29, she ‘wanted to build’ something new

Lucy Guo, CEO of Passes and co-founder of Scale AI.

Lucy Guo

• Lucy Guo co-founded data labeling startup Scale AI, which is valued at $13.8 billion.
• She also founded the venture capital firm Backend Capital and the startup incubator HF0.
• Guo is now CEO and founder of Passes, a startup that helps creators monetize their audience.

Many tech founders prefer to enjoy their success away from the public eye after building a successful business. Others dive right back into the workforce to start their next big thing.

But Lucy Guo, 29, co-founder of data-labeling startup Scale AI, blurs the line between the two archetypes.

She describes herself as an “adrenaline junkie” and will stop at nothing to get attention. She is active on social media, where she cultivates her provocative persona, parties with artists like Billie Eilish and Charlie XCX, dances the night away at music festivals, and skydives to unwind. Guo even threw an entire festival called Lucypalooza to celebrate her birthday and became famous for a wild party she threw with a lemur and a snake at her luxury Miami condo.

Yet this is the character many have come to know since Guo left Scale AI in 2018. In addition to the bustling social life of a successful young entrepreneur, she is still building herself. Since Scale AI, Guo has founded a venture capital firm, Backend Capital, a startup incubator HF0, and most recently, a creator-focused membership platform, Passes, which raised a $40 million Series A in February.

“People think I party a lot,” Guo said. “I definitely want to change that opinion.”

Between social media posts about parties and fast cars, we get glimpses of his other passions: gym classes at Barry’s Bootcamp and long hours at the office.

Guo’s daily routine is more that of a CEO than a club kid. She gets up at 5:30 a.m. and is a big proponent of back-to-back morning workouts, which she says gives her more time to work long hours at the office. And once there, she often stays until midnight.

“People only see one side of your life,” Guo said, referring to his social media presence. “I don’t post pictures of myself in the office until midnight because it’s a boring story.”

“I need to make money”

At first, tech was a way for Guo to make a lot of money. She grew up in Fremont, California, a city east of San Francisco. Her parents, who immigrated from China, made a modest living as electrical engineers but were laid off early in Guo’s life. As a result, they were extremely frugal, Guo said.

“I was bullied at school because I was poor,” she said. “So I thought, ‘OK, I have to make money.’”

That’s what inspired Guo to learn to code. And during that period of her life, that’s pretty much all she did. “I spent almost all my time at home alone in front of my computer,” Guo recalls.

One of her first successes came from the virtual pet game Neopets, where she learned how to use the bots to gain in-game advantages, such as earning more Neopoints. She would then sell the upgraded accounts for thousands of dollars.

From that early success, Guo continued to hone his skills. “I remember going to Fry’s Electronics and sitting all day reading books on how to use HTML and CSS.” As he progressed, his income grew. Guo developed bots, including a Twitter bot, and built digital marketing websites, eventually earning five figures by the time he finished high school.

Guo went on to study computer science and human-computer interaction at Carnegie Mellon University, where she continued to code and participate in hackathons.

Soon, that desire to build took precedence over her desire to finish her degree, and with just a few classes left to complete her dual degree, Guo decided to drop out in 2014. But she had a good reason: She was awarded a Thiel Fellowship, which gives young entrepreneurs $100,000 to drop out of school and start their own businesses.

During her internship, Guo built a meal delivery app, which ultimately failed due to food safety concerns. However, the experience gave her a solid technological foundation, and she became a full-time product designer at Quora, the Q&A discussion platform founded by former Facebook employee Adam D’Angelo. She later became Snap’s first female product designer.

From hacker to founder

After working at Quora and Snap, Guo wanted to start over. She teamed up with Alexandr Wang, whom she had met at Quora. “Alex and I had always talked about starting a company,” Guo said.

Guo and Wang experimented with several ideas. The first, dubbed ClassPass for clubbing by Guo, was a subscription service for local clubs. The next idea was a platform to find the best doctor for specific needs, inspired by Guo’s own experience after breaking his jaw in an electric skateboard accident. With that idea in mind, they applied to the Y Combinator startup accelerator for the summer of 2016. But halfway through the program, they changed course again, this time to what would become Scale AI.

Lucy Guo, CEO of Passes and co-founder of Scale AI.

Lucy Guo

The idea for Scale AI came from a suggestion from one of their YC roommates, who proposed creating an “API for humans.” “When he said that, I thought, this is very controversial,” Guo said. “It’s a brilliant idea.”

Guo and Wang then developed a product to connect customers with contractors to perform manual, time-consuming tasks. They initially focused on outsourced phone calls, but quickly narrowed their focus to data labeling and quality control for autonomous vehicles, an emerging sector at the time.

“Cruise became one of our first customers,” Guo said. “There’s a lot of money in self-driving cars.” Since then, Scale AI has grown rapidly, becoming a dominant force in the data labeling industry. It has raised $1.6 billion in total funding, according to PitchBook, and was recently valued at $13.8 billion.

Guo left the startup in 2018.

“The desire to build”

After Scale AI, Guo decided to apply her knowledge to a new entrepreneurial opportunity: investing. Accel, one of Scale AI’s investors, provided Guo with research funding to invest in startups. Her initial success led her to create her own venture capital fund, Backend Capital, which has since invested in hundreds of early-stage startups.

Backend Capital raised $8 million for its first fund, followed by a $40 million second fund. Notable investments include expense management platform Ramp and compensation benchmarking tool Pave.

In addition to his venture fund, Guo co-founded the startup incubator HF0 in 2019 with Dave Fontenot, who continues to run the program. During the three-month program, founders live together in a large San Francisco mansion, focusing entirely on building their startup. In exchange for a 5% stake and an uncapped $1 million investment, HF0 takes care of “everything a founder spends time on,” including food, laundry, and fitness classes.

“Living with all these founders, I started to want to start a company,” Guo said. “I thought living with founders and basically incubating companies or helping other companies would be fulfilling, but I thought, ‘Yuck.’”

This growing desire to create something of her own led Guo to a new idea: Passes, a creator-focused monetization platform she founded in 2022.

“Creators are entrepreneurs,” Guo said, citing examples like Kylie Jenner’s lipsticks and Jake Paul’s men’s grooming brand. She believes creators are essential to marketing their products and should have more control over their audience. “If you have a thousand superfans willing to spend $5 a day on you, that’s income.”

Guo’s vision for Passes quickly gained momentum. Guo, as CEO and sole founder, raised $9 million in seed funding led by Multicoin Capital within a week of launching the round. “We literally had no name for it, no website, no platform,” she said. “It was pretty crazy. It was a text message fundraiser.” In February, Passes raised a $40 million Series A led by Bond Capital.

Pass office area

Lucy Guo

Passes help creators monetize their audiences through a variety of channels, including subscriptions, live streaming, one-on-one calls, paid messaging and online stores. “It really allows people to own their fans,” Guo said, explaining that a creator making $7,000 on Instagram can grow to $350,000 to $450,000 per month with passes.

The platform’s creators span categories from sports to chess to music. Through Passes, creators can keep up to 90% of their revenue, with the platform taking a 10% commission and 30 cents per transaction. The company has already reached eight figures in annualized net revenue, Guo said.

Passes’ product roadmap is expansive. Drawing on her expertise in AI, Guo wants to launch features like AI-driven pricing to assess the value of content and how much fans are willing to pay. She also plans to introduce a donation feature, allowing creators to donate a portion of their Passes revenue to nonprofits. Her long-term vision is for Passes to help “creators become entrepreneurs and start building generational wealth.”

“Every one of my designer friends always asks me: How can I create my own brand?” she said.

Guo, who is no stranger to brand building, is willing to help.