AI startup Cohere raises US$500-million, valuing company at US$5.5 billion

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The company’s latest financing round was led by the Public Sector Pension Investment Board and counts Cisco Systems Inc., AMD Ventures, Fujitsu and Export Development Canada as new investors

Canadian artificial intelligence startup Cohere Inc. has raised US$500-million in a new financing round to compete with rivals OpenAI, Anthropic, Google and other well-funded rivals seeking to develop and profit from generative AI.The round was led by the Public Sector Pension Investment Board, which manages pensions for the Canadian federal public service, and includes new investors Cisco Systems Inc., AMD Ventures, Fujitsu and Export Development Canada.

Cohere, founded in 2019 in Toronto, builds the large language models that underlie chatbots and other generative AI applications. The company is distinguishing itself from competitors by focusing narrowly on building models that can be tailored for business use, such as customer service chatbots, rather than making general purpose applications like OpenAI’s ChatGPT or text-to-image generators.

“It’s that philosophical difference of getting this stuff to be useful,” said Cohere co-founder Nick Frosst in an interview, “and not chasing but focusing on solving enterprise problems.”

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