Cohere Rides Wave of Enterprise Demand for "Sovereign AI" to $6.8B Valuation

Cohere, an AI startup, has raised $500 million, pushing its valuation to $6.8 billion. Unlike OpenAI, Cohere builds enterprise-first AI models that run behind corporate firewalls, trained directly on client data. Deals with major companies like Oracle and RBC are stacking up, as businesses prioritize privacy, compliance, and geopolitical uncertainty. Cohere is targeting $200 million in annual recurring revenue and has hired key executives to scale its platform.

Toronto-based AI startup Cohere has announced a significant $500 million funding round, bringing its valuation to $6.8 billion. The round was led by Inovia Capital and Radical Ventures, with participation from notable investors such as AMD Ventures, Nvidia, PSP Investments, and Salesforce Ventures [1].

Founded by ex-Google researchers, Cohere specializes in building enterprise-first AI models that run behind corporate firewalls, trained directly on client data. This approach sets it apart from consumer-focused AI startups like OpenAI. Cohere's models are used to perform tasks such as writing website copy and powering chatbots for major enterprises, including Oracle, RBC, and Dell [2].

The funding round also saw the hiring of key executives. Joelle Pineau, a former VP of AI research at Meta, has been appointed as Cohere's chief AI officer, while Francois Chadwick, a former CFO of Shield AI, has taken on the role of chief financial officer [1].

Cohere has been experiencing robust growth, with its annual recurring revenue doubling to $100 million earlier this year and aiming to reach $200 million by year-end [2]. The company's latest product, North, a "security-first" agentic AI platform, is being used by clients such as the Royal Bank of Canada and Dell. North integrates generative and search models with workflow automation tools, supporting compliance with global standards [2].

The funding round underscores the continued momentum in AI startup funding. According to Crunchbase data, AI-related enterprises have been receiving the largest share of venture funding, with nearly half of U.S. venture funding going to AI-related enterprises over the past year [1].

References:
[1] https://news.crunchbase.com/ai/enterprise-genai-startup-unicorn-cohere-raise/
[2] https://www.pymnts.com/news/investment-tracker/2025/ai-startup-cohere-raises-500-million-hires-former-meta-and-uber-executives/