Cohere in Talks to Raise Up to $1 Billion in Funding
OpenAI rival Cohere is in talks to raise up to $1 billion in funding, according to a report by FT.
This will be the most money ever to come to the Canadian startup as the AI race heats up. Cohere had four funding raises thus far, with the last one in June 2023 putting the startup’s valuation at $2.2 billion. Former Google scientists Aidan Gomez and Nick Frosst are the founders of Cohere, along with Ivan Zhang. Gomez co-authored the famous seminal paper on Transformers that has revolutionized large language models. Frosst worked at Google Brain under Turing award winner Geoffrey Hinton’s Toronto team.
Cohere develops large language models for enterprises to build custom applications such as AI chatbots, using their own data. In contrast, OpenAI’s large language models are meant for wider use for consumers and businesses alike. Cohere is one of AI Business’ seven companies to watch in 2024.
VC Flight to Quality in AI Startups
AI startups commanded “substantially higher” valuations than non-AI startups, obtaining valuations over 1.5x higher than their non-AI counterparts in series B rounds, according to new research from CB Insights. However, the surge in valuation was not the result of higher funding raises, since this has continued to fall since 2021. CB Insights said total equity deals to AI startups in 2023 dropped to their lowest level since 2017. The research firm said the decline does “suggest investors are focusing their efforts on an industry-wide flight to quality.”
“For the select AI startups able to capture investors’ attention right now, this gives them even more leverage to command better deal terms and higher valuations when raising.”
Key Takeaways:
– Cohere is in talks to raise up to $1 billion in funding and is one of the seven companies to watch in 2024
– AI startups are commanding higher valuations compared to non-AI startups, indicating a flight to quality in the industry
In Talks to Raise $1 Billion:
– Cohere, an OpenAI rival, is seeking a record funding of $1 billion as the AI race intensifies
– Founded by former Google scientists, Cohere focuses on developing large language models for enterprise applications
– The company is one of the seven companies to watch in 2024
VC Flight to Quality in AI Startups:
– New research indicates that AI startups have substantially higher valuations compared to non-AI startups
– Despite a decline in funding raises, investors are focusing on a flight to quality in the industry
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