Microsoft-backed AI startup Inflexion raises $1.3 billion from Nvidia and others

June 29 (Reuters) – Inflection AI, a startup backed by several Silicon Valley giants, said on Thursday it raised $1.3 billion from investors including Microsoft and Nvidia amid an AI boom (TO THE).

The investment, a mix of cash and cloud credit, valued the year-old company at $4 billion, a source familiar with the matter told Reuters.

Inflexion released its Pi chatbot last month. Founded by Google DeepMind co-founder Mustafa Suleyman and LinkedIn co-founder Reid Hoffman, it has focused on building consumer-facing AI products and is considered a major rival to OpenAI.

Pi uses generative AI technology, similar to ChatGPT, to interact with users through dialogues, allowing people to ask questions and share feedback. Inflexion said it wants to build personal AI that helps people plan, schedule, gather information, and perform other tasks.

Inflexion AI, headquartered in Palo Alto, California, has approximately 35 employees. It raised $225 million in a first round of funding in early 2022 from Greylock, Microsoft and Reid Hoffman.

Last week, it released a report on its Inflection-1 model, which powers the Pi, and claims it has outperformed most available models.

Most of the funding will be used to build computing power to develop a more powerful baseline model, according to Suleyman, chief executive officer of Inflexion.

“We’re going to build a cluster of about 22,000 H100s. That’s about three times more processing than was used to train all of GPT4. Speed ​​and scalability are what will really enable us to create a differentiated product,” Suleyman said at Collision Conference Thursday.

The AI ​​space has been hailed as the next frontier for technology after OpenAI’s ChatGPT bot became a viral sensation late last year.

The sector has attracted several investors in recent months as companies look at ways to integrate the technology into their businesses, while regulators have pondered how to approach the technology.

Microsoft (MSFT.O), an existing investor and also a backer of rival OpenAI, attended Inflection’s latest fundraiser.

Nvidia (NVDA.O), which recently stepped up its investments in artificial intelligence, Hoffman, Bill Gates and former Google CEO Eric Schmidt also participated in the latest round, Inflection said.

Reporting by Niket Nishant in Bengaluru and Krystal Hu in Toronto; Editing by Vinay Dwivedi and Conor Humphries

Our standards: the Thomson Reuters Trust Principles.

Niket Nishant

Thomson Reuters

Niket Nishant brings you the latest news and quarterly earnings from Wall Street’s biggest banks, card companies, new financial technologies and asset managers. It also covers the largest US exchange IPOs and late stage venture capital financings along with news and regulatory developments in the cryptocurrency industry. His writings appear in the finance, business, markets and future of money sections of the website. She holds a BA from the Indian Institute of Journalism and New Media (IIJNM) in Bangalore.

Krystal Hu

Thomson Reuters

Krystal reports on venture capital and startups for Reuters. She covers Silicon Valley and beyond through the lens of money and characters, with a focus on growth-stage startups, tech investments, and artificial intelligence. She previously covered M&As for Reuters, covering stories about Trump’s SPAC and Elon Musk’s Twitter funding. Previously, she reported on Amazon for Yahoo Finance, and her investigation into the company’s retail practice was cited by lawmakers in Congress. Krystal began a career in journalism writing about technology and politics in China. She holds a master’s degree from New York University and enjoys a scoop of Matcha ice cream as much as getting a scoop at work.

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