Generative AI

Cohere Secures $500M to Outpace Competitors in Generative AI

22 July 2024

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Zaker Adham

Summary

Generative AI startup Cohere, founded by former Google researchers, has successfully raised $500 million from investors such as Cisco, AMD, and Fujitsu. This significant investment values the Toronto-based company at $5.5 billion, more than double its valuation from June 2023.

The latest funding round also saw participation from Canadian pension investment manager PSP Investments and Canada’s export credit agency EDC, bringing Cohere’s total raised to $970 million. This influx of capital is set to accelerate Cohere's growth, with plans to expand its technical teams and develop advanced, data privacy-focused enterprise AI.

According to Josh Gartner, head of communications at Cohere, the company is committed to moving beyond esoteric benchmarks and delivering tangible benefits to global businesses through AI. Notably, Cohere’s AI models are designed for various tasks, including document summarization, website content creation, and chatbot functionalities.

While initially targeting between $500 million and $1 billion for this fundraising round, Cohere managed to secure contributions from major players like Nvidia and Salesforce Ventures. This achievement underscores the company’s robust position in the competitive generative AI landscape.

Cohere was founded in 2019 by Aiden Gomez, Nick Frosst, and Ivan Zhang, all of whom previously collaborated at FOR.ai. Gomez is also known for co-authoring the influential 2017 paper "Attention Is All You Need," which has been foundational for many leading AI models, including OpenAI’s GPT-4 and Stability AI’s Stable Diffusion.

Unlike its competitors such as OpenAI and Anthropic, Cohere focuses on enterprise applications rather than consumer-facing products. Its AI platform is cloud-agnostic, supporting deployment across public clouds, private clouds, and on-premises environments. Cohere works closely with clients like Oracle, LivePerson, and Notion to customize AI models based on proprietary data. The company also runs a nonprofit research lab, Cohere for AI, which develops open models for text understanding and analysis.

Cohere’s growth strategy has proven effective, with the company reporting $35 million in annualized revenue by March 2024, a significant increase from $13 million at the end of 2023. As the demand for generative AI solutions grows, Cohere's recent funding and ongoing partnerships with tech giants like Google Cloud and Oracle position it well for continued success.

In 2024, Cohere plans to double its current headcount of 250 employees to further support its ambitious goals.