These AI start-ups on perfusion to face the giants of the sector

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Fundraising in the generative artificial intelligence (AI) sector continues, but is not necessarily the same. Perplexity, Stability AI, Dust… In recent days, several AI start-ups have raised large sums of money, and although their ambitions are different, they all have good hopes of competing with the giants of the industry.

This is the case of Perplexity AI, a young start-up founded in 2022 with a very ambitious objective: to overshadow Google in the field of online search. Its platform, which combines a search engine and a chatbot, abandons links to provide textual responses to users. A formula that bears fruit, since Japanese giant SoftBank plans to invest between $20 million and $30 million in the company.

Perplexity draws its strength from its ability to deliver information in real time, a feature that most other chatbots do not have. The involvement of SoftBank, which intends to rebuild its financial health by investing massively in artificial intelligence, demonstrates the appeal of its technology despite a recent controversy concerning one of its products generating summaries of news articles.

Dust, French start-up that wants to become big

In parallel, the French start-up Dust has raised $16 million, with big names in venture capital like Sequoia Capital. The company offers a platform deploying specialized AI assistants, directly linked to the data and documents of client companies. From now on, Dust wants become the most powerful platform for fast-moving teams who want to improve their work with actionable AI assistants », she assures in a statement.

Both deals are evidence of the huge buzz surrounding generative AI startups today, with investors willing to spend huge sums to capitalize on the technology boom, despite the obvious risks involved. At the same time, industry players need funds to finance their highly energy-intensive and costly operations. The latter allows them to access the resources they need.

Stability AI is trying to get back on track

Stability AI, the firm behind the Stable Diffusion image generator, has also just completed a major fundraising round. Amounting to $80 million, it will above all allow it to get back on track, while its situation has been getting worse for several months. Beyond the opacity of its business model, the company must face several complaints, accusing it of copyright violations for the training of its models.

Management also decided to promote Prem Akkaraju to the position of CEO, to replace Emad Mostaque, who left since March. An appointment suggesting a future takeover, the manager having previously been at the head of Weta FX, a company specializing in special effects in cinema. Initially one of the only free tools, Stable Diffusion has since faced competition from industry leaders, as demonstrated by the integration of Dall-E into ChatGPT or Microsoft’s Copilot. To ensure its survival, the company must collect funds and renew itself.

The race for funding by AI start-ups does not seem to be ending any time soon, as demand continues to increase. And concerns about a possible speculative bubble should not dampen the greed of investors, eager for liquidity after a particularly dull post-pandemic period.

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