Published on November 21, 2023, 3:10 pm

One AI startup is cashing in on the struggles of another. AI21 Labs, a company focused on developing generative AI products similar to OpenAI’s GPT-4 and ChatGPT, has closed a $53 million extension to its Series C funding round. This latest investment brings the total raised by AI21 to $336 million, while the company’s valuation remains steady at $1.4 billion.

The funding round included participation from new investors Intel Capital and Comcast Ventures, highlighting AI21’s appeal and potential in the market. The additional capital injection will be utilized for product development and expanding the startup’s workforce. It wouldn’t be surprising if some of their new hires came from OpenAI, as several notable employees have recently departed or joined Microsoft.

CEO Ori Goshen expressed gratitude to investors who believe in AI21 Labs’ deep technology expertise. He emphasized the importance of developing high-performance language models that deliver value and impact efficiently. AI21 stands out by designing purpose-driven AI solutions that are more cost-effective than building from scratch.

Based in Tel Aviv, AI21 Labs was founded by Amnon Shashua (co-founder of Mobileye), Ori Goshen, and Yoav Shoham (the other co-CEO) in 2017. Their flagship product is AI21 Studio, a developer platform that offers custom text-based business applications using proprietary text-generating AI models. The company also provides Wordtune, a multilingual reading and writing AI assistant similar to Grammarly.

Customers can access specific generative AI capabilities such as summarization, paraphrasing, grammar correction, and spelling correction through APIs on the AI21 Labs platform. The startup’s models support multiple languages including Spanish, German, Italian, and Dutch.

In the highly competitive space of generative AI, with rivals like OpenAI as well as well-funded startups such as Cohere and Anthropic, AI21 highlights its “more comprehensive systems approach.” According to Yoav Shoham, their AI enriches generative AI with knowledge and reasoning, going beyond statistical inference. While some may debate the extent of this differentiation, there’s no denying AI21’s impressive customer momentum. Goshen revealed that they have “several” Fortune 100 companies as clients and boast over 10 million users of Wordtune alone.

AI21 Labs’ partnerships with Dataiku and Amazon, particularly regarding the launch of Amazon’s Bedrock generative AI development platform, have likely contributed to its success. Goshen believes that enterprises are looking for unique partners who understand their specific needs, which has helped increase AI21’s mindshare.

It’s worth noting that Intel has a significant interest in generative AI investment and has previously backed Stability AI. This connection is likely due to Intel’s ownership of Mobileye and the long-standing involvement of Amnon Shashua with Intel. However, it cannot be overlooked that Intel might also be feeling pressure from competitors like Nvidia, who have reaped immense benefits from the AI boom.

AI21 Labs’ recent funding round and growing customer base solidify its position as a rising star in the field of generative AI. With innovation and strategic partnerships at its core, all eyes are on AI21 as they continue to make waves in this competitive industry.

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