AI21 Labs, a startup based in Tel Aviv that specializes in developing AI tools for generating text, has successfully raised $155 million in a Series C funding round. Leading this round were investors including Walden Catalyst, Pitango, SCB10X, b2venture, Samsung Next, and Amnon Shashua, who is not only a co-founder of AI21 Labs but also the founder of Intel-owned Mobileye. Notably, major players like Google and Nvidia also participated in the funding.
This funding brings AI21 Labs’ total capital raised to $283 million, and it places a valuation of $1.4 billion on the company—slightly higher than the $1.2 billion reported earlier by The Information.
AI21 Labs emerged from stealth mode in October 2020 with its first product, Wordtune, an AI writing tool. According to Yoav Shoham, one of the co-CEOs of AI21 Labs, the company has experienced substantial growth since then, doubling its workforce and having plans for further expansion.
Founded in 2017 by Amnon Shashua, Yoav Shoham, and Ori Goshen, AI21 Labs is recognized for its flagship product, AI21 Studio. This developer platform enables the creation of custom text-based business applications utilizing AI21’s proprietary text-generating AI models, including the advanced Jurassic-2 model. Additionally, the company offers Wordtune, an AI assistant for multilingual reading and writing similar to Grammarly.
AI21 Labs’ technology can be accessed by customers through APIs to meet specific generative AI needs such as summarization, paraphrasing, grammar, and spelling correction. The company’s AI models support multiple languages, encompassing Spanish, German, Italian, Dutch, and more.
While AI21 Labs competes with several other startups and established players in the rapidly growing field of generative AI, it claims distinct advantages. Shoham highlights that their solutions are based on some of the world’s largest and most sophisticated language models, offering refined control and up-to-date data for accurate results.
The recent funding infusion is expected to fuel AI21 Labs’ research and development efforts and help the company achieve its vision of advancing AI capabilities across various domains. The company also intends to forge more partnerships in the tech ecosystem, with a primary focus on research and business development roles.
Notably, the cost of developing and maintaining large language models is significant. For example, OpenAI reportedly spent $540 million to create ChatGPT, and AI21 Labs’ research estimates expenses of up to $1.6 million for training a text-generating model with 1.5 billion parameters. Hosting costs for these models can also be substantial.
Despite these challenges, AI21 Labs has been steadily gaining traction, with products like Wordtune amassing over 10 million users. The company was also among the launch partners for Amazon’s generative AI app development platform, Bedrock.
