cohere raises $270M from investors including nvidia and oracle

Cohere, a generative AI platform, raised $270 million in its Series C funding round led by Inovia Capital. The round included participation from several strategic investors including NVIDIA, Oracle, Salesforce Ventures, DTCP, and others.

Sources familiar with the details of the funding round commented that the AI startup was valued at around $2.1 billion. This is less than half the valuation of Anthropic, another startup that has developed generative AI technology and that competes directly with the creators of ChatGPT, OpenAI.

The latter remains one of the most valuable AI-focused businesses in the world, with most estimates putting its price tag at around $25 to $30 billion. In addition, OpenAI is backed by the tech giant Microsoft (MSFT), which recently invested $10 billion into the company and owns a 49% stake.

The funding will help accelerate Cohere’s position as a leader in delivering generative AI solutions for organizations on the cloud platform of their choice. The company’s AI platform is designed specifically for businesses, offering flexible deployment and customization options to meet data security requirements. This includes partnerships with consulting firms to help enterprises at every stage of their AI journey.

Overall, Cohere has raised $445 million, which is a staggering figure, even among high-flying AI startups. These companies need significant funding for research and development as training AI models is costly due to an elevated demand for computing resources.

It seems that large tech companies are playing a game of who pick the best horse in the so-called AI race with Microsoft being the top backer of OpenAI, Alphabet (GOOG) putting most of its chips into Anthropic and its “constitutional AI”, and NVIDIA and Oracle standing behind Cohere.

Aidan Gomez, Cohere’s CEO and co-founder, said the funds will help Cohere “lead the way” in bringing generative AI products and services that will transform businesses. Meanwhile, Jensen Huang, NVIDIA’s CEO, said that Cohere “has made foundational contributions to generative AI” and their service will help enterprises harness these capabilities.

Cohere is a Cloud-Agnostic Generative AI Solution for Enterprises

Cohere’s platform is cloud-agnostic and can be deployed on any cloud provider, within a customer’s existing cloud environment, or even on-premise. This gives businesses the flexibility to innovate existing products and build next-generation solutions while keeping their data secure.

In addition to the funding, Cohere highlighted recent momentum in enterprise demand, a collaboration with Salesforce Ventures, an engagement with LivePerson to enhance customer experiences, and high rankings for the accuracy of its AI models in recent evaluations.

Ai startups pre-money valuation averages

Steve Woods from Inovia Capital, the leading VC firm in this latest funding round, highlighted that artificial intelligence is one of those “very few ideas” that can transform society and add value to mankind.

This is why the fund decided to back Cohere in its effort to create a generative AI solution for enterprise applications and software that can be easily implemented regardless of which infrastructure the organizations have selected to power their operations.

Cohere’s LLM Can Be to Create Content, Summaries, and Perform Searches

Cohere’s press release emphasized that its proprietary large language model (LLM) has been touted by researchers from Stanford University who said that it was among the most accurate compared to its rivals.

The company’s technology can be used in five different ways. It can be embedded into customers’ existing software, used to create content from scratch, as a tool to create summaries, perform advanced searches on documents and other files, or classify elements.

Also read: 50+ ChatGPT Statistics on Usage & Revenue for June 2023

According to the startup’s website, the cost of using Cohere’s generative AI varies depending on how the technology is implemented on the client’s backend infrastructure. If the solution is embedded into the system, the cost of 1 million tokens stands at $0.4 for the default model and $0.8 for the custom model. This applies to both input and output tokens.

Meanwhile, the cost to use the generative AI model, which can be reportedly tapped on to create product descriptions, summaries, and marketing resources stands at $15 per every 1M tokens for the default model and $30 for 1M tokens for the custom model.