The Information : Mercor’s Fast Growth Relies on Biggest AI Companies, Documents

Mercor’s Fast Growth Relies on Biggest AI Companies, Documents Show

The Takeaway
  • Nearly all of Mercor’s gross revenue this year came from AI model makers
  • Mercor’s gross revenue, or sales before paying its contractors, jumped 70% in first half from full-year 2025
  • Three-year-old startup predicts it will increase revenue from non-AI customers

Mercor, a three-year-old data startup whose army of contractors teaches AI to give better answers, is growing fast but relies heavily on revenue from AI foundation model companies, financial documents seen by The Information show.

The company generated $614 million in gross revenue in the first half of the year, up 70% from all of last year, according to the documents. About 91% of the first half revenue came from makers of AI foundation models. Mercor’s top customers include OpenAI, Anthropic and Google DeepMind, the company has told potential investors, along with newer AI labs such as open-source provider Reflection AI and Thinking Machines Lab.

The concentration among the biggest AI companies points to a simmering concern among investors: Many startups owe much of their growth to a few large customers whose decision to take their business elsewhere—or handle it internally—could abruptly cool the torrid trajectory of these startups. It is a central question as Mercor discusses a new round of funding that, according to a person familiar with the matter, could value it at $20 billion, double its level last fall.

That higher valuation would follow Mercor’s March disclosure that it was among the companies targeted by hackers in a supply-chain attack. The revelation prompted Meta Platforms to pause its work with the company, according to Wired. Meta, which also owns a 49% stake in Mercor rival Scale AI, has not resumed working with Mercor, according to the person.

Mercor said last month the impact on customer information was “very limited,” and few contractors had “sensitive information” breached.

The startup predicts that the concentration of its customers in foundation models will fade over the next half decade as it sells more of its evaluation and training services to other AI startups, including app developers that need to evaluate their customized models, as well as large companies outside AI that want to make sure their agents are working as intended. The company’s fundraising material listed financial firms such as Ramp, Blue Owl and Citi as customers.

By 2028, Mercor expects gross revenue from AI startups and Fortune 2000 companies combined to eclipse gross revenue from foundation models. By 2030, it expects foundation models will represent just under one-third of its anticipated gross revenue of nearly $69 billion. Fortune 2000 companies, in contrast, will make up 57%, Mercor has told potential investors.


The documents point to other constraints on the business, which has fetched increasingly high valuations as revenue has surged.

It pays about two-thirds of its gross revenue to contractors, the legion of lawyers, doctors, writers and doctorate holders that grade AI models’ answers to questions. Those payouts kept its gross margin to 27% last year and 33% in the second quarter of this year. It anticipates gross margins rising to 46% next year and 56% in 2030.

Mercor’s past gross margins aren’t far off from comparable metrics at OpenAI and Anthropic, which both missed their own gross margin forecasts as the costs of running their AI models spiked. But Anthropic late last year expected gross margins could hit 77% in 2029, while OpenAI earlier this year predicted gross margins would close in on 70% toward the end of the decade.

Those levels would put the model makers close to best-in-class software companies such as GitLab, which reported an 86% gross margin in its most recent financial quarter—a sharp contrast with Mercor.

Rocketing Revenue

Mercor was started by college dropout Brendan Foody and two of his high school classmates and has emerged as one of the most prominent in a competitive cohort of startups. The companies, which include Scale AI, Handshake AI and Surge AI, supply specialized training data to AI companies looking to improve or fine-tune their models.

Mercor’s annualized gross revenue—monthly revenue multiplied by 12—hit $2 billion in June, double the pace from early this year, and it told potential investors it expects to hit $2.8 billion in annualized gross revenue by year end.

Similarly, rival Handshake’s gross revenue jumped 82% by April from January, to an annualized pace of nearly $1 billion.

The businesses, which rely mainly on human contractors, risk losing demand to startups that specialize in designing copies of popular apps like Salesforce or Excel to teach AI how to use those apps. Some researchers say these fake apps, otherwise known as reinforcement learning environments, work better for certain disciplines than human experts do.

Earlier this month, Mercor said it had bought Deeptune, a startup that designs RL environments, which Mercor said will help the company quickly build more realistic training environments for apps. Mercor also argues that there will continue to be a growing market for humans to train AI, particularly in high-stakes, complicated situations like legal cases.

The startup swung to a small operating profit last year, of $9 million, but sees that leaping to $226 million this year and $1.7 billion next. It forecast that its operating margin will rise from 3% last year to 12% this year and 26% next year, eventually climbing to 45% in 2030. Those forecasts would put it closer to best-in-class software stocks on this basis. Palantir had an operating margin of 46% in the first quarter.

The Information : Meta’s AI Incubator Is Developing an OpenRouter Rival to Cut C

Meta’s AI Incubator Is Developing an OpenRouter Rival to Cut Coding Costs

The Takeaway
  • Meta’s new AAI Labs incubator is developing an OpenRouter rival called Switchboard
  • Switchboard is among 200 early-stage projects at AAI Labs
  • Router would send some AI tasks to cheaper models to reduce inference costs

Meta Platforms’ internal incubator for AI-powered products and tools is developing a version of the OpenRouter service that would help cut costs by sending some AI tasks to lower-cost models.

The incubator, called AAI Labs, is part of Meta’s Applied AI Engineering team, which Meta set up in March and allows employees to pitch AI-powered products and services for internal use—and possibly later release them to the public. Once a proposal is approved, a small team is assembled to build and potentially launch it, according to internal documents reviewed by The Information.

A July memo says AAI Labs has about 200 approved projects spanning consumer products, developer tools and internal infrastructure.

The AI model router, dubbed Switchboard, is among those projects. It would determine which models should handle each request from a human user or AI agent by scoring tasks by difficulty. It would send simpler requests to smaller, cheaper models, similar to the way that OpenRouter’s Auto Router product works, according to one of the documents.

As with many projects inside AAI Labs, Switchboard is an early-stage effort and may never be launched as a product, according to a person familiar with the matter. But the Meta team working on the project said in the document outlining the project proposal that the company could use Switchboard internally to lower costs, and release it publicly to organizations running AI coding agents at scale, the document shows.

Projects developed under AAI Labs reflect Meta’s appetite for turning its enormous AI investment into potential new tools, businesses and revenue streams beyond advertising. The company has projected its spending on AI infrastructure and other equipment and facilities could hit $145 billion this year, more than double the amount in 2025, and it has been reorganizing its engineering teams to strengthen AI development.

The AAI Labs projects also show how Meta is turning to employees for this effort, to quickly prototype AI-powered products that can either improve Meta’s internal operations or become standalone products released to the public.

Meta also has been looking for ways to rein in the billions of dollars it is spending on AI tools for its coders and other employees. As The Information previously reported, the company told employees in June that it would begin imposing limits on AI token usage just weeks after encouraging broader adoption of AI tools across the company, while also building an internal platform to track AI spending and enforce token budgets.

The Value of AI Routers

OpenRouter has gained popularity among developers looking to access various AI models while trying to reduce costs. The Information last week reported that the company has held discussions about a potential acquisition by a bigger technology company—a deal that could boost OpenRouter’s valuation by billions of dollars. In April, it was valued at $1.3 billion valuation.

Model routing gained broader attention last year when OpenAI released GPT-5, which included a router that automatically switches to a cheaper model when a user’s prompt is relatively less complex. Other companies, including Databricks and Palantir, have developed their own router tools to help manage costs and improve efficiency.

One of the internal Meta documents describes the problem that the company’s engineers hope to address through Switchboard: “We pay top-model prices for every coding request, including the easy ones.” Most coding-agent tasks can be handled by smaller models, while only a minority require the capabilities of more expensive frontier models, according to the project proposal rationale outlined in the document. “Today everything goes to one model, so we overpay on easy work or underperform on hard work,” the document says.

The document states that inference costs are the primary barrier to deploying agents more broadly across the company. “Cost is what limits how widely we can run agents,” the document says.

Meta declined to comment.

Among the other projects under development at AAI Labs is an AI-powered tour guide app for drivers that would run through Apple CarPlay and Android Auto. It envisions using AI to narrate nearby landmarks and to allow drivers to ask questions about those points of interest, according to a separate internal document outlining the plans. The document positions the product as an extension of Instagram’s Map experience that could eventually incorporate location-based Reels and travel recommendations and perhaps later integrate with Meta’s Ray-Ban smart glasses. Meta could release the app publicly after testing it among employees first, according to the document.

The formation of AAI Labs aligns with CEO Mark Zuckerberg’s broader vision that AI will enable smaller teams to build products more quickly. In April, he told analysts that AI agents mean “small groups of people and teams can make very rapid progress” and predicted the technology would drive “a lot of innovation.” Zuckerberg also has said that Meta could build as many as 50 new apps.

FT : The battle that could lead to Sudan’s next catastrophe Army-held El Obeid h

The battle that could lead to Sudan’s next catastrophe
Army-held El Obeid has come under growing drone assault in offensive by the country’s feared paramilitaries

The Sudanese city of El Obeid has come under intensifying drone attack as paramilitaries battle to prise control of central Sudan from the army, in what international officials warn could mark a grim next chapter of the civil war.

The Rapid Support Forces have targeted water, electricity and fuel supplies in and around El Obeid, a major commercial centre in Sudan’s Kordofan provinces and trading hub for livestock and gum arabic, which is used in products from make-up to Coca-Cola.

The city, which has a population of half a million and an additional 100,000 internally displaced people, lies six hours by road from the capital Khartoum.

The United Nations and western countries have repeatedly warned of the threat of massacres on a par with those in the city of El Fasher in Darfur — which the RSF over-ran last October — should the paramilitaries seek to capture El Obeid.

Sudanese analysts, aid agencies and experts monitoring the war say the bigger danger in the immediate future is of a cholera outbreak, with the disease already spreading in other areas of North Kordofan, of which El Obeid is the capital.

“The situation is horrific. There is a lack of fuel, lack of water, lack of electricity. Water plants are being hit, gas stations are being hit, electricity stations are being hit,” said Kholood Khair, a Sudanese political analyst whose mother is from the city.


Khair said the price of transport, on top of attacks along the roads, has made it much harder for people to flee the city should they choose. “There is one road in and one road out. Both are facing heavy bombardment.”

The region around the city has been the subject of intense fighting since the onset of the civil war in April 2023 between the Sudanese Armed Forces and their erstwhile allies in the RSF, led by renegade general Mohamed Hamdan Dagalo, known as Hemedti.

El Obeid was under a prolonged siege that was only broken by the SAF in February last year and is now cut off again from three sides.

According to data from the International NGO Safety Organisation, North Kordofan has had the highest number of drone attacks in 2026 in a war that has increasingly been fought from the air.

The attacks have intensified over the past month, with more than half of 141 strikes recorded to July 8 taking place since June. The vast majority of these were concentrated on El Obeid and the main road leading to the city from the east, which is still controlled by the army.


“Drone attacks are impacting basic services, rising transport and fuel costs, and limiting access to safe drinking water and healthcare,” said Liesbeth Aelbrecht, emergency co-ordinator for Médecins Sans Frontières in Sudan.

She was able to visit the city recently and described desperate scenes at hospitals, with dwindling supplies of medicines and shortages of fuel to run backup power generators.

“There are almost no remaining functional fuel stations and the price of one litre of gasoline has reached nearly $15,” she said.

Researchers have repeatedly accused the United Arab Emirates of supplying weaponry including drones to the RSF, which the US under the Biden administration accused of genocide. The UAE has repeatedly denied evidence of its involvement in the Sudan war.


The capture of El Fasher in Darfur last year marked one of the bloodiest episodes of the civil war in which both sides have repeatedly been accused of atrocities.

Some 6,000 people were slaughtered by the RSF in just three days, according to a UN fact-finding mission, which said the massacres bore the hallmarks of genocide.

“We have seen this modus operandi by the RSF before,” Mona Rishmawi, a member of the UN’s Independent International Fact-Finding Mission for Sudan, said this month when warning of the paramilitaries’ tactics in and around El Obeid.


Experts on Sudan, however, say there are important differences between the two cities.

Residents of El Fasher had already been living in famine conditions by the time the RSF captured it last October. The city was also the last redoubt for Black African Zaghawa and Fur ethnic groups that had been driven from other parts of Darfur during years of ethnic cleansing by the RSF, which grew out of the primarily Arab Janjaweed militia.

El Obeid, though strategically important in the war, did not have that ethnic dimension, said Khair. Aid agencies are still able to reach El Obeid, the army and affiliated militias are well supplied, and there has been no recent evidence of a build-up of RSF forces to suggest an imminent attack, said Nathaniel Raymond, head of the Yale Humanitarian Research Lab.


Raymond has closely monitored the war using satellite imagery, open-source intelligence and witnesses on the ground, and issued clear warnings about what was coming in El Fasher months beforehand.

“Right now drones have exacerbated conditions for a cholera outbreak in El Obeid,” he said. “That could spread like wildfire.”

WSJ : Private-Equity Assets Stuck in ‘Zombie Funds’ Are at a Record High Funds a

Private-Equity Assets Stuck in ‘Zombie Funds’ Are at a Record High
Funds are outliving their intended lifespans as fund managers struggle to sell the remaining assets

  • U.S. private-equity assets stuck in funds at least a decade old hit an all-time high of $348.5 billion at the end of 2025, PitchBook data show.
  • The slowdown in sales has created a liquidity crunch for some pension funds and insurance companies that need to meet payout obligations to retirees.
  • Fund managers who bought assets at peak prices in 2020 and 2021 are struggling to find buyers willing to pay those prices at higher borrowing rates.

A record level of private-equity investments are stuck in funds limping along past their intended lifespans.

Often known as zombie funds, these funds are no longer raising money or making new acquisitions, in part because fund managers haven’t been able to sell their remaining assets. The net asset value of U.S. private-equity assets stuck in funds at least a decade old reached an all-time high of $348.5 billion at the end of 2025, according to PitchBook data. That is 3.5 times the amount in 2015 and more than 100 times that of 2005.

The slowdown in private-equity sales has fueled frustration among investors eager to cash out. Many managers of funds launched in the mid-to-late 2010s struck deals for their existing portfolio companies at the peak of the market in 2020 and 2021, when interest rates were nearly zero. Buyers are now unwilling to pay peak prices at higher borrowing rates, leaving those funds stranded past their typical lifespans.

“In some cases, it’s three guys and a Labrador running the last few assets of the fund,” said Finbarr O’Connor, chief investment officer and founding partner at Treo Asset Management, an outsourced manager for zombie funds.

Some institutional investors haven’t been able to make new investments with their assets tied up in aging funds. The liquidity crunch is especially painful for pension funds and insurance companies that need to meet payout obligations to retirees. The rise of zombie funds could lead to more institutional and high-net-worth investors reducing their private-equity allocations, O’Connor said.

The billions sitting in funds a decade or more older is just the beginning. A wave of maturing assets in the seven-to-nine-year-old bucket behind them is also rising. The net asset value of those funds reached $512.7 billion in 2025, more than two times that of 2015, PitchBook said.


Many funds that snapped up assets during the height of the dealmaking boom are now confronting a more sober environment.

“A huge number of private-equity funds launched in the last 15 years and it would only make sense that there’s now going to be a culling of the herd,” said Dan Rasmussen, founder of asset manager Verdad Advisers.

Overall, the estimated value of portfolio companies that haven’t been sold totaled $3.91 trillion as of September 2025, locking up 74% of all North American private-equity assets on balance sheets, according to Preqin. That unrealized value has steadily risen from $922.8 billion a decade earlier. Meanwhile, dry powder has grown at a slower pace due in part to fundraising hurdles.

Firms have turned to the secondary market and so-called continuation vehicles, which give investors an opportunity to cash out while allowing the sponsor to hold on to the asset. Sponsors say most continuation vehicles aren’t intended for zombie funds, as many buyers in the secondary market aren’t focused on impaired assets.

Some private-equity sponsors say holding assets longer is often intentional to focus on deep value creation.

Mill City Capital, a private-equity firm based in the Minneapolis area, runs a flagship fund that is 11 years old. The fund has two remaining investments, one of which is on the market to be sold, people familiar with the matter said.

The fund’s holdings include a stake in Horizon Hobby, which makes model trains and radio-controlled planes, cars and boats. The firm has remained an active dealmaker by shifting to an independent sponsor model, raising capital for new acquisitions as recently as 2024.

Argand Partners, based in New York, is still running a buyout fund that is almost 10 years old. The firm said it doesn’t consider it a zombie fund and that it invests in its companies and regularly strikes other deals for special purpose vehicles and co-investments, including the Capezio dancewear brand.

A spokeswoman for Argand said the firm typically holds companies for three to four years, but that it was unable to sell the businesses in that fund because the pandemic and subsequent economic shocks froze the mergers and acquisitions market. “We continue to be optimistic that the M&A market will see a recovery over the next 12 months,” she said.

Francisco Alvarez-Demalde, managing partner of private-equity firm Riverwood Capital, said he isn’t seeing fire sales, or funds selling companies at deep discounts. But he said the industry will likely experience a correction.

“There’s going to be a cleansing between different funds, different assets,” said Alvarez-Demalde, who added that Riverwood is well-positioned. “Some assets will lose in that.”

>>> US After Hours Summary: SMCI +18% jumps on guidance, DELL +5.7%, HPE +4.9%,

After Hours Summary: SMCI +18% jumps on guidance, DELL +5.7%, HPE +4.9%, MRVL +2.1%, MU +1.5% higher in sympathy; FNWD +20.2% to be acquired; PEGA -13.4%, AIR -4.9% lower on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: SMCI +18% (guides JunQ revs to the low end of guidance, but raises gross margin guidance; backlog rose to record levels), WFRD +3.2%, NLY +1.5%, EQT +1.1% (also signs 5-yr offtake agreement with large Asian energy co), COF +0.1%

Companies trading higher in after hours in reaction to news: FNWD +20.2% (FFBC to acquire FNWD), OSUR +6.8% (gets FDA EUA for second-generation OraQuick Ebola test), RKLB +6.5% (awarded a $266 mln Air Force contract for suborbital launch), OKLO +5.8% (Oklo and X-energy join Trump administration program to bring new nuclear reactors online faster for AI, according to Bloomberg), CPHI +5.7% (comments on unusual market activity), DELL +5.7% (in sympathy with strong SMCI guidance), HPE +4.9% (in sympathy with strong SMCI guidance), MRVL +2.1% (in sympathy with strong SMCI guidance), MU +1.5% (in sympathy with strong SMCI guidance), ISSC +1% (acquires Aydin Displays), BEP +1% (to combine BEP and BEPC into single public corporation), IMRX +0.7% (publication of new findings in Cancer Research), ALAB +0.7% (in sympathy with strong SMCI guidance), ALB +0.3% (increases dividend), CDE +0.3% (outlines record 2026 exploration spend at Palmarejo, Las Chispas), DIS +0.3% (Pixar Animation Studios takes brunt of company-wide layoffs, according to Variety), NRIX +0.1% (NRIX collaboration with Roche closes after HSR clearance)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: PEGA -13.4%, NBHC -5.7%, AIR -4.9%, OZK -2%, WAL -1.9%, EWBC -1.8%, ALK -1.7% (also to replace Hawaiian's 717 Neighbor Island fleet with 737-800s starting in 2028; also to add four leased 737-800 freighters, doubling dedicated cargo capacity), RRC -1.3%, CB -0.8%, KREF -0.7% (also to review strategic alternatives), IBKR -0.5%

Companies trading lower in after hours in reaction to news: DYN -10.1% (launches $300 mln common stock offering), CLDX -7.4% (Phase 2 barzolvolimab study misses key efficacy goals), NNDM -0.7% (names interim CEO; also Phillip Borenstein becomes chairman), HMN -0.3% (two transactions with Medical Mutual of Ohio ), PANW -0.2% (to buy Embrace), BIP -0.1% (to combine BIP and BIPC into single public corporation)

FT : Samsung in talks to invest in Mistral at €20bn valuation

Samsung in talks to invest in Mistral at €20bn valuation
South Korean giant could invest as much as €1bn in French AI group seeking to be a leading alternative to US tech

Samsung is in talks to invest hundreds of millions of euros in the AI start-up Mistral, a move that would bolster the French company’s efforts to become a leading alternative to US technology groups.

The South Korean conglomerate is discussing an investment in Mistral as part of a broader fundraising round that could value the group at roughly €20bn, according to people familiar with the matter.

Samsung, which had previously backed the group through its venture arm, could invest about €1bn in the new round, one of the people said.

The talks reflect a broader push by AI developers to secure partnerships with semiconductor suppliers as the industry grapples with surging demand that far outstrips the supply of computing power.

Mistral is seeking to capitalise on growing interest from European and Asian companies and governments for alternatives to leading US AI models, after the Trump administration blocked foreign access to Anthropic’s latest Mythos and Fable models last month.

The US export controls on Anthropic have sparked a wave of interest in “sovereign AI” capacity. From its inception, Mistral has focused on “open” AI models that can be customised and controlled by customers, meaning no company or government can switch them off.

Samsung has previously invested in Mistral through its venture arm. Overall, Mistral is seeking to raise several billion euros as part of a new round, the people added, which comes less than a year after it was valued at €12bn in a deal led by Dutch chip equipment giant ASML.

Swedish investor EQT’s Scaleup Europe Fund is also in talks to back the fundraising round, these people said. Talks remain ongoing and the terms could yet shift, with no final decisions yet taken, the people cautioned. Sifted previously reported on EQT’s discussions.

The vehicle, which is expected to exceed €5bn, is backed by Brussels and managed by EQT. It has also attracted backing from private investors including Novo Holdings and Santander to fund promising European companies in competitive sectors such as AI.

Mistral, Samsung and EQT declined to comment.

The Paris-based group raised €1.7bn in September, with most of those funds coming from ASML, which is using its AI models to accelerate production of the sophisticated machinery used to make cutting-edge chips. Earlier this year, Mistral raised $830mn in its debut debt financing to support the construction of Nvidia-powered data centres across Europe.

Mistral and Samsung have previously discussed collaboration in the AI memory sector, South Korean media reported in April. Samsung is the world’s largest maker of memory chips and has seen its profits surge over the past year as rising AI demand drives up prices.

The US export controls on Anthropic sparked a wave of interest in “sovereign AI” capacity. From its inception,

But Mistral’s open models face growing competition from China. Moonshot’s latest Kimi model has sparked a new round of fears that low-cost Chinese rivals were narrowing the gap with US frontier AI systems.

Founded three years ago, Mistral has become Europe’s most valuable AI start-up. Chief executive Arthur Mensch told the FT in February that Mistral’s annual recurring revenues were on track to exceed $1bn by the end of this year, following a push to expand its enterprise customers.

Mistral’s talks with Samsung come as the AI industry faces an unprecedented chip crunch, as suppliers of memory and other semiconductors needed to run and train AI systems rush to expand capacity.

Last month, US memory manufacturer Micron invested in Anthropic as part of a wide-ranging partnership that included a long-term memory and storage supply agreement.

This week, Mistral struck an expanded partnership with Microsoft, one of its earliest investors, that sees the US software group making a “multibillion-dollar commitment” to use the French AI start-up’s computing infrastructure.

The Microsoft deal will help Mistral fund its own investment in computing capacity by providing a stable source of revenue that it could borrow against, as it adds thousands of Nvidia’s latest Vera Rubin chips. Mistral’s latest models will also be made available through Microsoft’s Azure cloud-computing service.

FT : European heatwave wiped €2bn from value of grain crop, analysis estimates

European heatwave wiped €2bn from value of grain crop, analysis estimates
France and Hungary worst hit by lost production of maize and wheat

Europe’s June heatwave wiped more than €2bn from the value of its grain crop, according to new analysis, with France and Hungary bearing the brunt of the damage.

Almost 9mn tonnes were removed from forecasts for grain production across the EU and UK in the four weeks following the heatwave, according to Coceral, the European grain traders’ association.

Analysis by the Energy and Climate Intelligence Unit valued the lost production at about €2.1bn in national farm-gate prices for wheat, barley, maize and other grains, or about 5 per cent using 2025 production value estimates.

The heat struck wheat during the critical period when kernels were filling in central and southern France, southern Germany, Austria, Poland and Hungary, Coceral said. Spring barley was more badly affected than the winter barley crop, which was largely developed before the temperatures rose.

The hottest June on record for western Europe follows a temperature rise of 3C over the 1991-2020 average, In France, the thermometer reached a high of more than 43C and in Hungary the peak was more than 40C.

Benoît Merlo, who grows cereals and raises beef cattle on a 300-hectare organic farm in Ain, eastern France, said he had spent a decade trying to protect his farm from hotter and drier conditions.

“I’ve been working on my farm for 10 years to make it more resilient through cover crops, crop rotations and species adapted to hotter and drier conditions,” he said.

“But with temperatures exceeding 38C for weeks on end, everything is breaking down. I’m expecting yield losses of at least 50 per cent, or even 70 per cent, for certain crops, such as soya. We’re no longer heading for a crash — we’re already there.”

About half of the reduction in Europe’s grain forecast came from maize, used mainly for livestock feed, which was caught during pollination in France and Hungary. Coceral cut its forecast for the EU and UK maize crop from 57.2mn tonnes to 52.7mn tonnes.

The EU is a net importer of the crop in poor harvest years, meaning the shortfall could increase demand for shipments from suppliers including Ukraine and Brazil.

The smaller French harvest could also reduce the amount of wheat available for export to buyers in north and west Africa, while higher feed costs are likely to filter through to livestock producers in coming months.

France accounted for almost half of the grain crop damage. Its forecast was cut by 4.1mn tonnes, worth about €891mn at current prices.

Most of its reduction came from maize, for which the forecast was lowered by 3.35mn tonnes to 9.4mn tonnes — below even the crop produced during the severe drought of 2022.

Hungary suffered the second-largest hit, with its grain forecast cut by 2.4mn tonnes, valued at about €444mn. Spain lost a further 1.4mn tonnes, worth €276mn, while Germany’s forecast was lowered by roughly the same amount, equivalent to €233mn of production.

The impact could be exacerbated for Hungarian farmers because domestic producer prices fell as the harvest approached, with cheaper Black Sea grain weighing on the market. That leaves growers facing the loss of production without the partial offset from higher prices, which could be received by some French farmers.

“This will hit farmers in the pockets, reducing their income and undermining European food security at the same time,” said Tom Lancaster, ECIU land, food and farming analyst.

The ECIU estimate represents the market value of production removed from harvest forecasts rather than the loss of farm profits. Higher prices may compensate some growers whose crops survived, while others may have sold grain forward before prices rose.

Upward revisions to harvests in Bulgaria, Romania, Italy and Finland reduced the net change in the value of expected European production to about €1.79bn. The analysis put the gross value of lost crops at between €2bn and €2.3bn under different price assumptions.

The losses come as EU governments negotiate the future of the bloc’s Common Agricultural Policy.

Théo Paquet, senior policy officer at the European Environmental Bureau, said instead of subsidies being used to fund resilience to climate change, they “continue to fund harmful practices that contribute directly to these crises — fuelling an expensive and unsustainable feedback loop”.

FT : UK ethical fintech boss tried to set up arms deals with Wirecard’s Marsale

UK ethical fintech boss tried to set up arms deals with Wirecard’s Marsalek
Algbra founder sought to help businessman later exposed as a fraudster and spy raise $2.75bn to buy Russian military tech

The head of an ethical fintech backed by Standard Chartered and marketed as “people and planet first” previously sought to set up arms deals with Jan Marsalek, the Wirecard executive who fled to Russia following the German company’s collapse.

Algbra founder Zeiad Idris was in regular contact with Marsalek before he was exposed in 2020 as a fraudster and Russian spy, according to WhatsApp messages seen by the FT.

As he was working to establish the London-based fintech, Idris in 2018 offered to assist Marsalek in raising a $2.75bn fund to acquire Russian military technology and sell it overseas, the correspondence shows.

In another exchange, Idris tells Marsalek an ex-colleague warned him to “stay away from Jan”, before adding: “I was never a good listener . . . Apparently you’re a bad boy.”

The pair’s relationship later took Idris to Marsalek’s Munich mansion and his private collection of military memorabilia, which included one artefact bearing an extraordinary claim: that it was a keepsake from the assassination of Osama bin Laden.

The proposed weapons fund was never launched. Idris says he has had no contact with Marsalek since the Austrian became a fugitive — before his work for Moscow was publicly known.

Algbra says it has had no relationship with Marsalek or Wirecard since it started trading.

An FT investigation has found that Marsalek participated in early-stage discussions about the creation of the business that became Algbra, however.


As Wirecard’s chief operating officer, Marsalek was the architect of the fraud that brought down the once-feted €24bn German payments company.

He also worked for years as a fixer for Russia’s GRU military intelligence agency, facilitating money laundering, blackmail and political interference as well as being involved in alleged kidnap and assassination plots. 

To most who knew him at the time, however, he was simply one of Europe’s most successful businessmen: a gifted and impressive young entrepreneur who was helping revolutionise digital banking.

Wirecard in 2019 started paying New World Capital Advisors, a subsidiary of London-based New World Group, the first instalments of what would become a £490,000 retainer to develop a business plan for a “global Islamic digital bank”, according to contracts seen by the FT.

At NWCA, Idris took personal charge of the project and was the point person for contact with Marsalek.

Idris was also in contact with IMS Capital Partners, Marsalek’s self-described “family office” over a possible anchor investment in the project.

In March 2020, IMS began discussing how a large investment in Algbra could use a complicated offshore trust structure in order to “avoid burdensome KYC [know your customer] questions”.

A further push was made by Idris to get IMS to invest in early June 2020, just weeks before Wirecard collapsed and Marsalek fled.

IMS Capital collapsed after Wirecard’s demise and is now under investigation by German prosecutors over suspected money laundering.

Algbra, a Mastercard-issuing ethical online bank pitched at Muslims in the UK, the Middle East and Asia, is regulated by the UK’s Financial Conduct Authority and counts former UK chancellor Philip Hammond among its advisers.

The company was first incorporated in May 2020 by Idris, company records show. It launched itself to consumers the following year. Idris became CEO in June 2021.

The start-up has become one of the success stories of the UK fintech sector, claiming to have processed more than £670mn of digital payments and boasting thousands of business and consumer clients.

As CEO, Idris has made ethics and integrity core to Algbra’s identity.

In the fintech’s 2024 annual report he wrote that its founding principles, which “sit at the intersection of ESG and Shariah compliance”, position it to serve customers “seeking ethical, future-proof financial solutions”.

An Algbra advertisement released last year, featuring a stand-off between two Wild West gunslingers who embrace rather than shoot, declares that the company believes arms are “for hugs”.

Idris has proved a consummate networker. Photographs show him in Silicon Valley lobbying for London with mayor Sadiq Khan and at the Chelsea Flower Show alongside Standard Chartered chief executive Bill Winters.

He told the FT he knew Marsalek from his time working at The Capital Partnership, a London-based investment firm founded by Ahmed Ben Halim, and at Libya Holdings Group, Ben Halim’s Libya-focused investment platform. 

Idris met Marsalek while helping raise funds for LHG investments. During the course of that relationship he also came to understand that Marsalek had deep connections to Russia and was involved with the Wagner mercenary group.

In a lengthy personal testimonial written in 2017 while trying to raise money after leaving LHG, Idris highlighted his relationship with the Austrian. 

“I know Jan Marsalek personally invested €10mn recently into a deal with Libya Holdings to acquire four oil rigs,” he wrote. Marsalek was also interested in acquiring a stake in LHG itself, he added, and had deep pockets. 

LHG and Ben Halim say they did not learn until 2022 that Marsalek had invested in their business. 

As was common in the thousands of messages involving Marsalek that the FT has reviewed over the years, the line between jest and seriousness was often hard to read. Exchanges with Idris about arms sales were peppered with personalised emojis and jocular language.

In October 2018, eager to court Marsalek as an investor for new business ideas he was exploring, Idris travelled to Munich, where Marsalek hosted him at his palatial villa.

There the then Wirecard executive showed Idris a private collection of war trophies and military memorabilia, including an item he presented as one of his most cherished relics: a transparent biological evidence bag, of US military origin, containing Muslim prayer beads and a piece of material.

The beads, Marsalek claimed, were held by bin Laden before his assassination by US Navy Seals, and the cloth was later used to wipe the al-Qaeda founder’s face. 

Idris later recounted the encounter to friends, along with pictures of the purported evidence bag.

The evening continued with Marsalek buying luxury Bavarian Lederhosen for Idris so he would fit in at Oktoberfest, where Marsalek was a regular high-spending corporate host, according to the messages.

On another occasion Marsalek sent Idris a presentation for the $2.75bn fund he was seeking to raise to purchase intellectual property relating to Russian military technology and bring it to market.

Although the tone of their correspondence was light-hearted, the presentation was dozens of pages long and contained close technical detail on weapons systems and their battlefield performance.

The apparent goal was to sell Russian military hardware to Qatar to help it achieve military parity with Saudi Arabia. Marsalek told Idris there would be no problems from Russian authorities.

A diagram with a pile of bullets at its centre said the fund, if established, would be a leading force in exports of advanced Russian weaponry. 

Idris told Marsalek he could market the fund using his London-based business and raise money for it through his own network of investors.

He prepared his own presentation for what he called the “Global Strategic Technology Fund”, which made no direct reference to weapons. It said a “Munich-based team” had “access to key people in Eurasia” and could guarantee access to “technology opportunities”.

The proposal went nowhere, not least because Idris’s business associates at NWCA and NWG were uneasy about Marsalek and wanted nothing to do with him, according to the WhatsApp messages. 

NWG, which removed Idris as a director in January this year but where he remains a major shareholder, declined to comment.

Idris is currently locked in a legal dispute with NWG.

StanChart, which via its investment arm SC Ventures is Algbra’s largest creditor, declined to comment.

Idris told the FT he had had “zero” contact with Marsalek since the Austrian’s disappearance. He added that Algbra had no ongoing link to Marsalek, and that it only began operations after Marsalek’s fall from grace. 

Idris also said he was a younger man when he first met Marsalek and had since changed. 

Idris appears to be among the last people in Europe contacted by Marsalek before his work for Russia became public. 

“Please make Algbra a truly great company in my absence,” Marsalek told Idris in a message on June 22 2020 — by which time he was already in Minsk and on his way to his exile in Moscow. 

FT : Are sunbeds ever safe? Use of tanning beds is surging. Experts are not imp

Are sunbeds ever safe?
Use of tanning beds is surging. Experts are not impressed

No
“The WHO has classified sunbeds as a Group 1 carcinogen — the same category as cigarettes and plutonium,” says consultant dermatologist Dr Ophelia Veraitch. A 2021 analysis of 14,000 people with melanoma – the most serious form of skin cancer — “consistently showed an increased risk associated with sunbed use”. The Department of Health and Social Care’s Committee on Medical Aspects of Radiation in the Environment said in its report last month that using sunbeds before the age of 35 increases risk of melanoma by 75 per cent.

So severe are the risks that, in January, the British Association of Dermatologists said it would support a complete ban on commercial sunbeds in the UK, “citing well-established links between sunbed use and skin cancer, inconsistent enforcement of existing regulations,” says consultant dermatologist Dr Clare Kiely.

In June the BAD shared the Comare report, which mentions some sunbed operators making “false and unsubstantiated claims of health benefits”. These are often reinforced by further misinformation on social media. A government All-Party Parliamentary Group looking into UV safety has recently called for a ban on sunbed advertising.

Brazil, Iran and Australia have already banned sunbeds. “It’s been a very good thing in helping to reduce melanomas,” says aesthetic physician Dr Joseph Hkeik, who has clinics in Sydney and London. “The rest of the world needs to follow suit.” If nothing else, let your vanity hold you back. “As well as increasing cancer, sunbeds accelerate ageing; they damage the DNA of your cells and break down collagen.”

Some sunbed retailers claim to promote collagen by adding infrared light as well as the UV. “This is laughable,” says aesthetic specialist Dr Sophie Shotter. “The UV harms collagen exponentially more than any benefit you’d derive from red light.” 

But what about… 
Yet, despite the panoply of risks associated with UV light, sunbed users claim benefits include improved mood, treatment of inflammatory skin conditions, and increased vitamin D. There is evidence to suggest that exposure to UV light may help reduce skin inflammation, providing relief for conditions such as eczema, psoriasis and acne. It’s therefore possible for sunbeds to suppress symptoms of those conditions – but that’s not to say they offer a solution that is safe. 

“Sunbeds expose the skin to artificial UV radiation, stimulating the skin to produce melanin – a tan,” explains Dr Veraitch. That tan can afford some protection, but only equivalent to SPF 3 (most dermatologists recommend SPF 30 at a minimum). Says Dr Veraitch: “Any tanning from the sun represents UV damage; the skin darkens to protect it from further damage.”


Dermatologist-approved light treatments work by harnessing specific, safe wavelengths of UVB light, which only affects the skin’s outer layer. “Commercial sunbeds deliver predominantly UVA light [the type that more deeply penetrates the skin], in poorly controlled doses, without clinical oversight,” says Dr Kiely. “It’s a wholly different thing.” 

For the same reason, sunbeds are not a useful source of vitamin D. “You need UVB light to make vitamin D,” continues Dr Veraitch. Modern sunbeds, such as the Ergoline Sun Angel, claim to stimulate the production of vitamin D by controlling the interaction between UVA & UVB light – but, again, there are much safer solutions out there. You’re better off following the NHS advice to take vitamin D supplements – around 10 micrograms per day – especially in the winter months.