Toronto-based artificial intelligence (AI) startup Cohere, which competes against ChatGPT creator OpenAI, has closed $270 million USD in Series C financing to fuel enterprise adoption of generative AI.
The all-equity, all-primary round was led by Inovia Capital, with support from a group of other venture capital and strategic investors from around the world that includes some of the world’s largest tech firms in Nvidia and Oracle, as well as Salesforce Ventures, DTCP, Mirae Asset, Schroders Capital, SentinelOne, Thomvest Ventures, and existing investor Index Ventures.
As the broader tech market has cooled, the AI sector—and generative AI in particular—has been heating up.
The company’s Series C round comes about 16 months after Cohere secured $125 million in Series B funding. Earlier this year, Reuters reported that Cohere was in talks to raise hundreds of millions of dollars in a round that could value the startup at over $6 billion. Per Bloomberg and VentureBeat, the firm’s latest financing gives Cohere a more modest valuation of more than $2 billion—as previously reported by The Globe and Mail.
Cohere aims to help enterprises adopt generative AI. As the broader tech market has cooled, interest in AI—and the generative AI space in particular—has been heating up. ChatGPT and image generator DALL-E have both gone viral, demonstrating the promise and peril of these new technologies, and investor interest in the sector has grown.
In a statement, Nvidia founder and CEO Jensen Huang proclaimed, “We are at the beginning of a new era driven by accelerated computing and generative AI.” The Nvidia leader claimed that Cohere has already made “foundational contributions to generative AI,” adding that the company’s service will help businesses globally harness the tech’s capabilities.
“As the early excitement about generative AI shifts toward ways to accelerate businesses, companies are looking to Cohere to position them for success in a new era of technology,” Cohere co-founder and CEO Aidan Gomez said in a statement. “The next phase of AI products and services will revolutionize business, and we are ready to lead the way.”
Founded in 2019 by ex-Google researchers, Cohere provides natural language processing (NLP) software powered by large language models (LLMs) to developers and businesses. Among other use-cases, Cohere’s LLMs can be added to products in order to power interactive chat features, generate text for product descriptions, blog posts, and articles, and analyze the meaning of text for search, content moderation, and intent recognition.
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Cohere, which first emerged from stealth in early 2021, enables enterprises to deploy NLP capabilities across their businesses without requiring supercomputing infrastructure or AI expertise, which the startup has claimed “radically reduces the cost for companies of all sizes to access leading AI models.”
“There’s no doubt AI is already transforming product experiences,” a Cohere spokesperson told BetaKit. “At this point, every enterprise has to look for AI partners or risk falling behind. Cohere’s aim is to be that partner of choice for those enterprises; that’s why we’re building the leading AI platform for business.”
Within the generative AI space, Cohere competes against players like Microsoft-backed OpenAI and Google-funded Anthropic, which each closed major funding rounds this year.
With this funding, Cohere has now raised $445 million to date from a group of backers that also includes Tiger Global, Radical Ventures, Section 32, Geoffrey Hinton, Fei-Fei Li, Pieter Abbeel, and Waabi’s Raquel Urtasun.
LLMs are expensive to train, and demand for computing power has grown alongside their popularity. Cohere’s latest capital will help the company meet its computing needs, grow its team, engage more enterprises, and advance its AI models.
Feature image courtesy Cohere.