Startup Cohere Inc. has become the latest name in the red-hot area of artificial intelligence to attract the attention of investors. It’s reportedly holding talks with potential backers about a funding round that could see it raise hundreds of millions of dollars and bring its value to more than $6 billion, Reuters said today.
The Toronto-based firm stands out from among a crowd of AI startups due to its close ties with Alphabet Inc., the parent of Google LLC. The company was co-founded by its Chief Executive Aidan Gomez, who previously worked as a researcher at Google Brain and is one of the co-authors of a landmark 2017 academic paper that first detailed the concept of a Transformer model. Transformers are a kind of neural network that have since become the basis for many key AI use cases, especially in the area of natural language processing, which is where Cohere is focused.
The main feature that sets Transformer models apart from other neural networks is their use of a so-called attention mechanism, which makes it possible to process text more efficiently than earlier technologies.
Cohere is developing generative AI models similar to OpenAI LLC’s wildly popular ChatGPC, which has an almost human ability to generate English text in response to questions and prompts. According to Reuters, Cohere’s plans include a dialogue model that will resemble ChatGPC, only it will be aimed at enterprise users such as developers and business analysts.
“Our chat models are focused more on business applicable tasks like answering questions than writing poems,” Gomez told Reuters. “We don’t plan to hand them over to everyone to use for free without limit. We want to build a healthy and sustainable business.”
Gomez declined to talk about the company’s funding status and Reuters said its anonymous sources were not clear how much money it is attempting to raise. To date, Cohere has raised $170 million from backers including Index Ventures, Tiger Global and individuals such as Geoffrey Hinton, Fei-Fei Li and Pieter Abbeel.
Unlike OpenAI, which has created models such as DALL-E for image generation in addition to ChatGPT, Cohere is exclusively focused on text generation models, Gomez said.
According to Gomez, Cohere’s AI models are being used to power a number of consumer applications, including the Hyperwrite tool that helps people to write more quickly with AI-generated prompts. It has been talking to a number of enterprises in areas such as marketing, consulting and technology too, focusing on helping those firms to incorporate generative AI into their business processes.
In November 2021, Cohere announced a partnership with Google Cloud that allows it to access Google’s power TPU processors. In January, the company made its language AI models available on Amazon Web Services Inc.’s SageMaker machine learning service.
Also last month, Cohere said it had hired former YouTube Chief Financial Officer Martin Kon as its new product and market strategy chief.
AI startups have captured the imagination of the public since ChatGPT exploded onto the scene last November. With Microsoft Corp. recently grabbing a much bigger stake in OpenAI through its latest $10 billion investment, investors are reportedly keen to get in on the action by backing the most promising rivals to ChatGPT. Recent reports suggest that AI startups that include Anthropic AI and Character Technologies Inc. are also seeking multimillion-dollar investments, though nothing official has been revealed so far.