AI startup Cohere in talks to raise funding at $6 billion plus valuation as race for regenerative AI heats up
Cohere, an AI foundation model tech startup and OpenAI competitor, is in talks to raise hundreds of millions of dollars in a funding round that could push the Toronto-based tech startup to more than $6 billion, Reuters reported, citing sources familiar with the ongoing talks.
The announcement comes following the sudden success of ChatGPT, an OpenAI dialogue-based AI chatbot that reached 100 million monthly active users in January just two months after launch, making it the fastest-growing consumer application in history.
Cohere was founded in 2019 by former Google Alphabet researchers Aidan Gomez, Ivan Zhang, and Nick Frosst to harness the power of language understanding to generate, categorize and organize text at a scale that was previously unimaginable. According to investors, the startup has quickly risen through the AI startup ranks given its intensive research background and close ties to Google.
In an interview with Reuters, CEO Aidan Gomez said that the company is planning to introduce its own dialogue model that would resemble ChatGPT to let corporate users generate text and engage with the model to refine the output. However, unlike ChatGPT, Cohere’s AI technology will mainly be accessible to developers and businesses.
“Our chat models are focused more on business applicable tasks like answering questions than writing poems. We don’t plan to hand them over to everyone to use for free without limit,” said Gomez. “We want to build a healthy and sustainable business.”
Foundation models is a term first popularized by the Stanford Institute for Human-Centered Artificial Intelligence to describe AI systems that are trained on large sets of data, with the ability to learn from new data to perform a variety of tasks. Unlike traditional AI, the goal of generative AI is to make human-like creations through computer code that has processed vast amounts of data.
Meanwhile, Cohere is the latest in a series of AI tech startups that have raised billions in funding as investors look for the next OpenAI and try to cash in from the last AI gold rush.
On January 23, Microsoft announced a new multi-billion dollar investment in ChatGPT-maker OpenAI following the $1 billion investment the software giant made in 2019. Microsoft declined to provide a specific dollar amount. However, as we reported earlier in back January, Microsoft was in talks to invest $10 billion in exchange for a 49% stake in the company.
Just five days after its launch, ChatGPT crossed one million users, according to a post by Open AI co-founder Sam Altman. To put that in perspective, it took Netflix 3.5 years, Facebook 10 months, Spotify 5 months, and Instagram 2.5 months to reach the one million users mark. It took about nine months after its global launch for the popular short video app TikTok to add 100 million users.