Cohere Raises $270M As AI Investment Frenzy Persists
The rush to invest in artificial intelligence startups shows no signs of slowing down. The aftermath of Microsoft’s investing $10 billion in ChatGPT parent company OpenAI early in the year has sparked an investment frenzy as venture capitalists look to gain exposure to the revolutionary technology. Toronto-based artificial intelligence startup Cohere is the latest to raise $270 million in a funding round spearheaded by a mix of venture capital and strategic investors.
Cohere Valuation Skyrockets
The investment spree comes as venture capitalists and other companies look to fill the void left by other failing investments around blockchain, virtual reality and augmented reality. The impact artificial intelligence technology is likely to have in various sectors and unlock new opportunities is one of the key drivers that has been spurring the investment drive.
Founded in 2019, Cohere is one of the AI startups that has taken the AI space by building large language models software that can analyze and generate tests and customize them for end users. Its solutions are already being used to summarize customer emails and write website copy. The company has been seeking investment capital from companies looking to deploy its technology to their customers.
The $270 million funding round that took the company’s valuation to between $2.1 billion and $2.2 billion was headlined by Oracle and Nvidia. According to Cohere Chief Operating Officer Martin Kon, Salesforce Ventures, Mirae Assets, and ThomVest Ventures participated in the funding round.
Surging AI Investments
Since 2020 investments into generative AI have increased by over 500% as investors and companies are looking to gain a piece of the technology and innovation likely to shape the future. Google is already investing billions of dollars into the technology that it hopes will help strengthen its monopoly in the search engine business.
Microsoft integrating ChatGPT into its search engine Bing at the start of the year rattled the segment prompting Alphabet’s Google to swing into action and unveil Bard. Generative Artificial Intelligence is seen as the technology that could revolutionize the way people carry out searches on the internet. Therefore, any company with an edge on it could dominate the multi-billion search business for years to come.
Microsoft and Google are not the only campiness spearheading the AI revolution. Amazon is another tech giant that has already set sights on the technology as it expects it to enhance its e-commerce business. The company is already using the technology to improve how it handles its inventory to ensure they are close to consumers to enhance the same-day and next-day delivery. Tesla is another tech heavyweight leveraging the technology to enhance its autonomous driving technology.
Cohere Long Term Plans
With the new funding, Cohere should be able to accelerate the development of its language models. The new funding should also help it meet its computing needs while expanding into new technologies as it looks to unlock new growth opportunities.
Since its inception, the company has raised nearly $445 million, benefiting from growing demand for startups with exposure to breakthrough AI solutions and innovations. Even with the aggressive funding round, Kon insists their primary goal is to ensure they do not give too much ownership or control of the startup to one company.