When Keelan Miskell wound down his crypto startup, he never imagined its digital archives would fetch $25,000. Now, a new industry is converting the data from defunct startups into AI training resources, breathing life into the digital dust of failed tech ventures.

Startups like Miskell’s are no longer just casualties; they’re contributors. Companies like SimpleClosure and Sunset help founders monetise their digital assets, selling off code and workspace data to AI labs and tech firms. The market is booming, with SimpleClosure expecting to return over $10 million to startups by 2026.

But the process is fraught with legal and ethical challenges. Privacy concerns abound, and the value of data remains uncertain. No one has yet tested the performance gains of training AI on real-world archives versus synthetic data, leaving valuations based on educated guesses. Meanwhile, the proceeds typically go to creditors and investors, not the employees who generated the data.

Despite these issues, the market is expanding. Major tech players like Google and SpaceX are already buying data from struggling startups, setting the stage for a Wild West of AI training. It remains to be seen whether proper licensing agreements and ethical considerations will catch up with the booming data resale industry.