Alphabet Inc.’s Google is in talks to invest at least $200 million into artificial intelligence startup Cohere Inc., according to people familiar with the matter, another sign of the escalating arms race among large technology companies in the sector.
Founded in 2019, Cohere creates natural language processing software that developers can then use to build artificial intelligence applications for businesses, including tools for chatbots and other features that can understand human speech and text. Last November, the company announced a multiyear partnership with Google to have its cloud division supply the computing power needed for Cohere to train its software models.
As a part of the negotiations, Cohere also held discussions with chipmaker Nvidia Corp. about a potential strategic investment, the people said. The talks between the companies are still ongoing and could fall apart, some of the people said.
Cohere’s valuation from any potential new funding couldn’t be learned.
Google and Nvidia declined to comment. Cohere, based in Toronto, didn’t respond to requests for comment.
Other technology giants are also looking to bet more on artificial intelligence. Microsoft Corp. is in advanced talks for a new funding round in OpenAI, another startup that is racing to create software models to achieve artificial general intelligence, or the ability for a machine to understand anything a human can, within years.
OpenAI already uses Azure, Microsoft’s cloud service, as its exclusive partner and has agreed to give priority to Microsoft when bringing technologies to market. Microsoft invested $1 billion in OpenAI in 2019.
Google CEO Sundar Pichai has emphasized the importance of AI to the company since taking over the top role in 2015. Alphabet purchased the AI research company DeepMind in 2014. Google’s research division, Google Brain, is also one of the most closely followed publishers on large language models and other AI topics.
Cohere CEO Aidan Gomez previously was an intern at Google Brain who worked on a paper that advanced the widely cited Transformer AI model.
Some researchers have cautioned that new AI models can pose thorny ethical questions and contribute to unwarranted hype in the sector.
The new funding would add to a flurry of investment activity for artificial intelligence startups in what has otherwise been a slow market for new deals. Cohere raised $125 million in a new funding round led by investment firm Tiger Global Management in February, bringing its total funding at the time to over $170 million.
On Monday, artificial intelligence firm Stability AI said it raised $101 million in new funding from investors including Coatue Management and Lightspeed Venture Partners. The company held a launch party in San Francisco that same day, where Google co-founder Sergey Brin was present.
