AI21 Labs, an Israeli generative AI startup building proprietary large language models, is raising a $300 million Series D funding round. The round boosts its total funding to $636 million and solidifies its position among the most heavily funded players in the AI infrastructure race, according to Business Insider.
The company's investor roster includes Nvidia NVDA, Google, and Intel Capital, all returning to support this new raise. Other backers include Walden Catalyst, Pitango, Comcast Ventures, and Samsung Next. These firms have placed long-term bets on the Israel-based startup's vision of AI built from scratch to serve enterprises with reliability, transparency, and performance, Business Insider reports.
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Proprietary Tech Designed for Accuracy at Scale
Founded in 2017, AI21 Labs was created by three tech veterans: Amnon Shashua, the founder of Mobileye, Yoav Shoham, a Stanford professor and former principal scientist at Google, and Ori Goshen, a serial entrepreneur known for launching CrowdX. According to Business Insider, the trio has focused on designing large language models for real-world business use that outperform in high-stakes and logic-intensive environments where hallucinations are a costly liability.
While most AI startups rely on foundation models created by OpenAI, Anthropic, AI21 Labs develops its own. These models, including the Jurassic-1 family and Jamba series, are purpose-built to meet the rigorous demands of enterprise clients, as detailed on the company’s website.
According to The New Stack, AI21 Labs' base model, Jurassic-1, contains up to 178 billion parameters, making it one of the largest LLMs on the market. It slightly surpasses OpenAI's GPT-3 Davinci model, which holds 175 billion parameters. Jurassic-1 is designed for high-performance use cases, with optimization for long-context comprehension and processing speed.
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The company's AI21 Studio allows developers to embed these models into applications for content generation, summarization, translation, and more. Enterprise customers include Capgemini, Fnac, and Wix WIX, which reportedly run hundreds of internal AI tools powered by AI21 infrastructure, Business Insider reports.
According to Intel Capital, this full-stack approach has helped AI21 differentiate itself in a landscape crowded with LLM wrappers and API-dependent tools. The startup's goal is to offer a more dependable AI backbone, one that addresses the growing enterprise need for accuracy, auditability, and scalability, AI21 said in a blog post.
AI Planning That Cuts Hallucinations by 50%
In March, AI21 introduced a flagship orchestration system called Maestro. Designed to increase the reliability of LLMs, Maestro functions as an AI planner that improves model reasoning by over 10% and reduces hallucinations by 50%, based on internal evaluations.
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The system breaks tasks into steps, selects optimal strategies, and validates results against user-defined constraints. According to the company’s website, Maestro has improved instruction-following accuracy for both Claude and GPT-based systems by significant margins, respectively from around 88% to 95.2% for Claude Sonnet 3.5, and around 85% to 91.9% for GPT.
Strategic Timing Amid AI Investment Surge
AI21 Labs' $300 million raise comes during a record-breaking quarter for AI venture capital. According to Crunchbase, nearly $7 billion was invested in AI startups globally in April, representing 30% of all venture funding. Israeli tech companies alone have secured more than $12 billion in 2024 so far, marking a 31% increase from the previous year, Business Insider reports.
The startup's steady momentum, combined with backing from Nvidia and Google, positions it as a rising force in the LLM sector. As demand grows for transparent and controllable AI systems, AI21's full-stack platform and orchestration tools may offer a compelling alternative to black-box models.
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