Cohere in Discussions for Up to $1 Billion in Funding
Cohere, a key player in the AI domain and a direct competitor of OpenAI, is currently engaged in discussions to secure a substantial funding amount of up to $1 billion, as reported by FT.
This potential funding round signifies a significant milestone for the Canadian startup as the competition in the AI sector intensifies. Cohere has previously undergone four funding rounds, with its most recent one in June 2023 elevating the startup’s valuation to $2.2 billion. Noteworthy supporters from the previous round included Nvidia, Oracle, Index Ventures, and Inovia Capital.
The inception of Cohere can be attributed to the collaborative efforts of former Google experts Aidan Gomez, Nick Frosst, and Ivan Zhang. Gomez, recognized for his contribution to the groundbreaking paper on Transformers, which has reshaped the landscape of large language models, while Frosst’s tenure at Google Brain, working alongside Turing award recipient Geoffrey Hinton in Toronto, further underscores the expertise within Cohere’s founding team.
Cohere specializes in the development of large-scale language models tailored for enterprise applications, enabling the creation of customized AI chatbots utilizing proprietary data. In contrast, OpenAI focuses on deploying large language models designed for a broader consumer and commercial audience.
Highlighted as one of AI Business’ notable companies to monitor in 2024, Cohere’s strategic positioning and innovative approach continue to garner attention within the industry.
Shift in VC Focus Towards Quality in AI Startups
Recent research from CB Insights sheds light on the evolving landscape of AI startups, indicating that AI-centric ventures are commanding significantly higher valuations compared to their non-AI counterparts, particularly evident in series B funding rounds where valuations surpass non-AI startups by over 1.5 times.
Despite the surge in valuations, the total equity funding directed towards AI startups has been on a declining trajectory since 2021, reaching its lowest point in 2023 since 2017. This trend suggests a notable shift towards quality-focused investments within the AI sector.
Investors are increasingly concentrating their resources on select AI startups, granting these entities greater leverage in negotiating favorable deal terms and securing higher valuations during fundraising endeavors.
Recent Funding Updates
ElevenLabs
ElevenLabs, headquartered in New York, specializes in AI-driven speech solutions for generating synthetic voices, enabling text-to-speech conversion and the creation of natural AI voices for diverse applications such as content development and marketing.
Latest Funding: $80 million (Series B)
Lead Investors: Andreessen Horowitz, Nat Friedman, Daniel Gross
Other Investors: Sequoia Capital, Smash Capital, SV Angel, BroadLight Capital, Credo Ventures
Utilization of Funds: Research initiatives, infrastructure expansion, product development for specific sectors, and bolstering safety protocols for responsible deployments.
Sakana AI
Sakana AI, based in Japan, is dedicated to constructing foundation models inspired by natural intelligence, founded by former Google AI experts Llion Jones and David Ha. The startup has already established a collaborative AI research venture with NTT, Japan’s premier telecommunications company.
Latest Funding: $30 million (Seed Round)
Lead Investor: Lux Capital
Other Investor: Khosla Ventures
Utilization of Funds: Establishment of an AI research facility in Japan, recruitment of researchers and engineers.
Vicarius
Vicarius, headquartered in New York, specializes in cybersecurity solutions aimed at assisting businesses in safeguarding against software exploitation. Their autonomous vulnerability remediation platform streamlines vulnerability assessments and remedial actions.
Latest Funding: $30 million (Series B)
Lead Investor: Bright Pixel Capital
Other Investors: AllegisCyber Capital, AlleyCorp, Strait Capital
Utilization of Funds: Advancing product roadmap, team expansion to support operational growth.
Recraft
Recraft, an image generation platform that emerged just eight months ago, has already amassed a user base exceeding 300,000. The startup is focused on enhancing image generation capabilities through its proprietary foundation model, promising a significant enhancement in AI-generated imagery quality.
Latest Funding: $12 million (Series A)
Lead Investors: Khosla Ventures, Nat Friedman
Other Investors: RTP Global, Abstract VC, Basis Set Ventures, Elad Gil
Utilization of Funds: Recruitment of a specialized team to develop an in-house foundation model, moving away from dependency on open-source systems like Stable Diffusion.
