Cohere, a generative AI startup founded by former Google researchers, has successfully raised $500 million from prominent investors, including Cisco, AMD, and Fujitsu. This funding round, which also saw participation from PSP Investments and Export Development Canada (EDC), values the Toronto-based startup at an impressive $5.5 billion, as reported by Bloomberg. This valuation more than doubles Cohere's worth since June 2023, when it raised $270 million from Inovia Capital and others, bringing its total funding to $970 million.
Josh Gartner, Cohere's head of communications, shared that this significant financing positions the company for "accelerated growth." He remarked, “We are actively expanding our technical teams to develop the next generation of accurate, data privacy-focused enterprise AI. Cohere is dedicated to advancing the AI industry beyond complex benchmarks to deliver genuine value in the daily operations of global businesses across diverse regions and languages.”
Cohere had aimed to secure between $500 million and $1 billion in this funding round and engaged in discussions with Nvidia and Salesforce Ventures throughout the process, as reported by Reuters. Gartner confirmed that both companies participated, bolstering Cohere's funding strategy.
Founded in 2019 by Aiden Gomez, Nick Frosst, and Ivan Zhang—who previously collaborated on research at FOR.ai—Cohere has made significant strides. Gomez is also a co-author of the pivotal 2017 paper, “Attention Is All You Need,” which underpins many leading generative AI models, including OpenAI’s GPT-4 and Stability AI’s Stable Diffusion.
In contrast to OpenAI, Anthropic, and Mistral, Cohere takes a different approach by primarily focusing on customization for businesses. The company’s AI models are designed to perform a range of tasks, such as summarizing documents, generating website content, and powering chatbots for clients like Oracle, LivePerson, and Notion.
Cohere’s AI platform is versatile, capable of being deployed across various environments, including public clouds like Google Cloud and Amazon Web Services, as well as private clouds and on-premises setups. The company adopts a collaborative approach, working closely with clients to create bespoke models tailored to their proprietary data.
Additionally, Cohere operates a nonprofit research initiative, Cohere for AI, dedicated to releasing open models, such as multilingual models for text comprehension and analysis. Its latest flagship model, Command R+, aims to provide capabilities comparable to pricier models like GPT-4 while maintaining lower costs.
Cohere’s strategy is paying off, particularly as competitors like OpenAI and Anthropic intensify their enterprise sales efforts. As of March, Cohere reported an annualized revenue of $35 million, a significant increase from approximately $13 million at the end of 2023, alongside a growing customer base of hundreds of companies, according to Bloomberg.
The pursuit of generative AI at Cohere’s scale entails substantial costs, especially as the company develops more advanced systems. This latest funding round will aid in those efforts, and the ongoing partnership with Google Cloud will provide the necessary cloud infrastructure to train and run Cohere’s models. Additionally, Cohere has a strong relationship with Oracle, which serves as both an investor and customer, integrating the startup's AI into numerous Oracle software products, including Oracle NetSuite.
Bloomberg also reports that Cohere plans to double its workforce of 250 employees this year.
Ranking
