Cohere announced on Thursday that it had raised an oversubscribed $500 million funding round, bringing its valuation to $6.8 billion. This marks an increase from its previous valuation of $5.5 billion, set just over a year ago when it raised a similar $500 million round.
Headquartered in Toronto, Cohere was one of the first breakout companies in the large language model space. Founded in 2019 by Aidan Gomez, a co-author of the influential “Attention Is All You Need” paper that laid the groundwork for modern AI, Cohere has positioned itself as a key player in enterprise AI. Unlike competitors such as OpenAI, Anthropic, and Meta, which dominate the consumer-facing AI market, Cohere focuses on providing secure, enterprise-grade language models.
The company has secured partnerships with major enterprise tech firms, including Oracle, Dell, Bell, Fujitsu, LG’s consulting service CNS, and SAP, as well as financial institutions like RBC. Notably, the Healthcare of Ontario Pension Plan joined as a new investor in this latest round. Cohere emphasizes its security-first approach, distinguishing its models from repurposed consumer AI offerings.
Despite its enterprise focus, Cohere has not been immune to the AI talent wars. The company recently hired Joelle Pineau, Meta’s former research head, as its chief AI officer. It also brought on Francois Chadwick, previously a consultant at KPMG, as its new CFO. Chadwick has prior experience in finance roles at Uber and as CFO at Shield AI.
The new funding round was led by Radical Ventures and Inovia Capital. Radical has backed companies like Fei-Fei Li’s World Labs, Hebbia, and Writer, while Inovia is a well-known Canadian venture firm with investments in Poolside and Neo4j. Existing investors, including AMD Ventures, Nvidia, and Salesforce Ventures, also participated. However, Oracle, which backed Cohere in 2023, was not listed as a continuing investor in this round.
Oracle had previously supported Cohere as an alternative to OpenAI but has since deepened its ties with OpenAI, particularly through a major data center initiative known as Stargate. This shift raises questions about the evolving dynamics between the two companies.
The announcement underscores Cohere’s growing influence in the enterprise AI sector, even as competition intensifies among major players. With fresh funding and high-profile hires, the company aims to solidify its position as a leader in secure, business-focused AI solutions.