A Peter Thiel-backed AI startup, Cognition Labs, seeks $2 billion valuation
Cognition Labs, a startup developing an artificial intelligence tool for writing code, is in talks with investors to raise funding at a valuation of up to $2 billion, in a test of the investor frenzy around new AI technology. If completed at that valuation, the funding would increase the startup’s valuation to nearly six times what it was weeks ago. Silicon Valley venture firms including Founders Fund, already a shareholder in Cognition, are in talks to invest in the current round, people familiar with the matter said.
Cognition only began working on its product last year and doesn’t generate any meaningful revenue. It was valued at $350 million earlier this year in a $21 million deal led by Founders Fund. Peter Thiel, the billionaire investor who started Founders Fund, helped lead its investment in Cognition.
The new fundraising deal hasn’t been finalized, meaning that the terms could change. The company recently has turned down offers at valuations closer to $1 billion—which would still be nearly triple the prior level. Cognition is the latest young startup whose value has soared thanks to a boom in artificial intelligence.
In December, the French AI model developer Mistral hit a $2 billion valuation, a roughly sevenfold increase from a funding round the prior summer. Perplexity, a two-year-old AI search startup, was valued at $1 billion in a funding round in recent weeks. Cognition, co-founded by Chief Executive Scott Wu, was first conceived as a crypto company but pivoted as AI took over Silicon Valley, launched by a wave of generative-AI applications following the release of ChatGPT.
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