AI startup Cohere in talks to raise roughly $500mln to $1bln – source

AI startup Cohere in talks to raise roughly $500mln to $1bln – source

Toronto-based startup Cohere is currently engaged in discussions with investors to secure a significant capital injection ranging from $500 million to $1 billion, according to information from a reliable source shared with Reuters on Friday. This fundraising initiative comes on the heels of a surge in investment activity in the artificial intelligence (AI) sector, spurred by the success of AI software application ChatGPT, which accounted for a third of venture capital in the United States last year.

Cohere, which had previously announced a funding round in June, raising $270 million and achieving a valuation of $2.2 billion, aims to leverage its expertise in AI to enhance business operations. While OpenAI, the creator of ChatGPT, and startup Anthropic remain key players, Cohere distinguishes itself by focusing on the practical applications of AI in business settings, striving to boost professionals’ efficiency in their respective roles. Notably, the startup has already demonstrated its capabilities in simplifying information search for infectious diseases for a specialized business client.

As executives convene at the World Economic Forum’s annual meeting in Davos, the quest for monetizing AI takes center stage. Cohere’s current capital-raising efforts are earmarked for the development of AI technology, talent acquisition, and the expansion of its sales activities. Founded in 2019, Cohere has strategically made its technology available across various cloud platforms and refrained from seeking financing in the form of credits for its own cloud usage.

While the Financial Times previously reported on Cohere’s capital discussions, Reuters has been unable to ascertain the specific valuation under consideration. Cohere CEO Aidan Gomez, who co-authored a seminal paper proposing a foundational AI architecture, is yet to respond to requests for comments on these recent developments.

 

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