Generative AI platform Cohere lands 500M in funding

Cohere, a generative AI startup co-founded by former Google researchers, has successfully raised $500 million in a new funding round. The investment was backed by notable players including Cisco, AMD, and Fujitsu. According to Bloomberg, this round also saw participation from Canadian pension investment manager PSP Investments and Canada’s export credit agency EDC. This latest funding round values the Toronto-based company at $5.5 billion, more than doubling its valuation from the previous year when it raised $270 million from Inovia Capital and others. This brings Cohere’s total funding to $970 million.

Generative AI platform Cohere lands 500M in funding to strengthen position in generative AI market

Josh Gartner, Cohere’s head of communications, stated that the new funding positions the company for “accelerated growth.” Gartner emphasized that Cohere is expanding its technical teams to develop the next generations of enterprise AI focused on accuracy and data privacy. He highlighted the company’s commitment to delivering real-world benefits in daily workflows for businesses globally.

In March, Reuters reported that Cohere was aiming to raise between $500 million and $1 billion for its next round of funding. Cohere was in discussions with Nvidia and Salesforce Ventures, both of which ultimately contributed to the round, Gartner confirmed in an email to TechCrunch.

Cohere was launched in 2019 by Aiden Gomez, Nick Frosst, and Ivan Zhang, who previously collaborated on research at FOR.ai, a precursor to Cohere. Gomez co-authored the influential 2017 technical paper “Attention Is All You Need,” which laid the groundwork for many advanced generative AI models, including OpenAI’s GPT-4 and Stability AI’s Stable Diffusion.

Unlike many of its competitors such as OpenAI, Anthropic, and Mistral, Cohere focuses on enterprise applications rather than consumer products. The company customizes its AI models for businesses, performing tasks such as summarizing documents, generating website content, and powering chatbots for clients like Oracle, LivePerson, and Notion.

Cohere’s AI platform is designed to be cloud agnostic, capable of deployment in public clouds (e.g., Google Cloud, Amazon Web Services), private clouds, virtual private clouds, or on-site. The startup collaborates closely with customers to develop tailored models based on their proprietary data.

Additionally, Cohere operates a nonprofit research lab, Cohere for AI, and releases open models, including multilingual models for text analysis. Its latest flagship model, Command R+, aims to provide many of the capabilities of more expensive models like GPT-4 at a lower cost.

Cohere’s approach has proven successful, with Bloomberg reporting that the company generated $35 million in annualized revenue by the end of March, with a customer base comprising hundreds of companies, up from $13 million at the end of 2023.

As Cohere continues to develop more sophisticated AI systems, the new funding will be crucial. The company also benefits from an ongoing partnership with Google Cloud, which provides the infrastructure for training and running Cohere’s models. Cohere maintains strong ties with Oracle, both as an investor and customer, integrating its AI into many of Oracle’s software products, including Oracle NetSuite.

Bloomberg notes that Cohere plans to double its 250-employee headcount this year, further strengthening its position in the competitive generative AI market.