The Billion-Dollar AI Club
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The kind of cash flooding into AI startups in the US is downright jaw-dropping! Recently, Ilya Sutskever’s Safe Superintelligence Inc (SSI) secured a whopping $1 billion in funding from NFDG, a16z, Sequoia, DST Global, and SV Angel, led by Nat Friedman and SSI chief Daniel Gross—an insane feat for a three-month-old venture. The newly-minted company has plans to scale computing power and build a highly trusted team of researchers and engineers focused on safe AGI, split between Palo Alto, California and Tel Aviv, Israel.?
In May this year, Elon Musk’s xAI raised $6 billion in Series B funding from Valor Equity Partners, Vy Capital, a16z, Sequoia Capital, Fidelity, and Al Waleed bin Talal Al Saud at a valuation of $24 billion, making it the second most-valuable generative AI company in the world after OpenAI. Meanwhile, OpenAI is reportedly in talks with Apple and NVIDIA to raise funding in the upcoming round, led by Thrive Capital, taking the value of the company to $100 billion. Rival Anthropic has raised $9.7 billion so far, and is valued at $18.4 billion after its last raise. When it comes to funding, it has raked in more than xAI’s hefty $6.4 billion, but its valuation doesn’t quite pack the same punch.?
Last month, xAI released Grok-2 and Grok-2 mini, its advanced AI models with enhanced text and vision understanding, available to ?? Premium users and developers via an upcoming enterprise API platform. Anthropic, on the other hand, has been the talk of the town with the release of its Claude Artifacts, which has been touted as an App Store killer.?
Cursor, an AI accelerator tool, developed by Anysphere, is also making waves for helping developers code seamlessly. The company landed $60 million in Series A funding from Thrive Capital, OpenAI, and a16z. Ironically, a lot of developers, both experienced and beginners, are leveraging Cursor with Anthopic’s Claude 3.5 Sonnet model more than OpenAI’s ChatGPT to build useful applications.?
10x the Stakes
Last year, French startup Mistral AI stunned everyone by pulling in $113 million in just four weeks of existence, setting what seemed like an unbeatable record for seed funding. But the game has changed fast and the stakes have gone much, much higher in no time at all.?
So far, Mistral AI has raised $1.18 billion from Lightspeed Venture Partners, NVIDIA, La Famiglia, Databricks Ventures, General Catalyst, Sofina, a16z, BNP Paribas, Bpifrance, Motier Ventures, Salesforce, IBM Ventures, Korelya Capital, and Emerson Collective at a $6 billion valuation (Series B).?
With Sutskever’s AGI safety startup raking in $1 billion, all eyes are now on Andrej Karpathy’s Eureka Labs, which aims to make education accessible for all with the help of generative AI. Recently, Karpathy said that he is looking to launch his product by year-end. It was only a matter of time before he made it to ‘The Billion-Dollar AI Club’.?
Besides OpenAI, xAI, Anthropic, Mistral AI, and SSI, other companies that have raised billions in funding include AI hyperscaler CoreWeave ($12.1 billion), Scale AI ($1.6 billion), Inflection ($1.5 billion), and Groq ($1 billion) among others.?
The waitlist: Cohere, has so far raised $942.9 million in funding from Index Ventures, NVIDIA, Raquel Urtasun, Geoffrey Hinton, Salesforce Ventures, Radical Ventures and others, at a $5.5 billion valuation (Series D).?
NVIDIA rival Cerebras Systems has raised $ 715 million from Eclipse Ventures, Foundation Capital, Benchmark, Altimeter Capital, Sequoia Capital, and Abu Dhabi Growth Fund among others.?
The outliers: In June this year, EvolutionaryScale raised $142 million in seed funding, led by Nat Friedman, Daniel Gross, and Lux Capital, alongside AWS and NVIDIA also participating in that round.?
This AI startup is focused on using LLMs to create novel proteins and biological systems, with plans to train advanced AI models, build a specialised team, and release its ESM3 models to revolutionise drug discovery and environmental solutions like plastic-degrading microbes.
Where’s India’s AI Billions?
India’s AI funding spree has barely begun. With Indian VCs sitting on $20 billion of dry powder, AI, notably generative AI, is on everyone’s mind, with an anticipation of 100 AI unicorns in the next decade.?
As per AIM Research, in the past six months alone, over 43 Indian AI startups received close to $864 million in funding. Bhavish Aggarwal’s Ola Krutrim leads the pack at $74 million, followed by Sarvam AI and Ema, which have raised $41 million and $36 million in Series A funding, respectively. TWO, on the other hand, has raised over $20 million in seed funding from Jio Platforms and South Korean internet conglomerate Naver.
In stark contrast to global counterparts talking billions, the highest funding here remains a modest $74 million. It’s almost like a ‘10x decel stake’ in the market, with $20 billion in dry powder still waiting to be unleashed.?
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