Business News Report
August 23, 2023

Hugging Face Expected To Secure $200M In Funding From Salesforce Ventures

In Brief

Salesforce CEO Marc Benioff announced that the company’s venture arm is leading the financing of AI startup, Hugging Face.

The funding amount is currently undisclosed, but reports suggest that the startup is expected to secure $200 million in the most recent funding round.

Salesforce CEO Marc Benioff today confirmed on X (Twitter) that the company’s venture arm will lead a new funding round for open-source AI company Hugging Face

Hugging Face has yet to announce the funding round and Benioff did not disclose on the funding size. However, The Information’s report suggests that the startup is expected to secure roughly $200 million from the new funding round, citing people familiar with the matter. The expected funding will place Hugging Face’s valuation at over $4 billion, which is more than 100 times its yearly revenue of $40 million. 

In July, Forbes reported Hugging Face’s efforts to raise new funds and that Sound Ventures, Ashton Kutcher’s venture capital firm, was positioned to take the lead in the Series D round. 

In May 2022, Hugging Face announced that it had raised $100 million in Series C funding led by Lux Capital with major participation from Sequoia, Coatue and others. The round valued the company at $2 billion despite generating less than $10 million in revenue the year before.

Insider sources informed Forbes that Clément Delangue, Hugging Face co-founder and CEO, was actively considering investment proposals from other potential investors.

Hugging Face offers AI compute access at a cost, commencing from $9 per month for Pro accounts and $20 per month for enterprises.

The startup asserts its standing as the fastest-growing community and the most-utilized machine learning platform. It boasts an excess of 100,000 pre-trained models and 10,000 hosted datasets. These encompass a broad spectrum of fields such as NLP, computer vision, speech, time-series analysis, biology, reinforcement learning, and chemistry.

The AI Startup Funding Race 

The financing signifies an ongoing frenzy surrounding promising AI startups. In June, Inflection AI raised $1.3 billion, to further develop its proprietary chatbot Pi. In the same month, natural language processing platform Cohere raised $270 million

Salesforce also invested in Anthropic’s $450 million Series C round in May, valuing the company at close to $5 billion, per a Reuters report

Likewise, OpenAI made waves by completing a $300 million share sale in April, followed by raising $175 million for a startup support fund a month later, as detailed in official filings. 

Additionally, Adept reached unicorn status after a successful $350 million fundraise in March.

With a valuation poised to exceed $4 billion, Hugging Face will be entering the ranks as one of the top three highest-valued AI startups, standing on par with Inflection AI and trailing just behind Anthropic. Recently, Anthropic also received an additional $100 million from South Korea’s SK Telecom, following its $450 million Series C.

Disclaimer

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About The Author

Cindy is a journalist at Metaverse Post, covering topics related to web3, NFT, metaverse and AI, with a focus on interviews with Web3 industry players. She has spoken to over 30 C-level execs and counting, bringing their valuable insights to readers. Originally from Singapore, Cindy is now based in Tbilisi, Georgia. She holds a Bachelor's degree in Communications & Media Studies from the University of South Australia and has a decade of experience in journalism and writing. Get in touch with her via [email protected] with press pitches, announcements and interview opportunities.

More articles
Cindy Tan
Cindy Tan

Cindy is a journalist at Metaverse Post, covering topics related to web3, NFT, metaverse and AI, with a focus on interviews with Web3 industry players. She has spoken to over 30 C-level execs and counting, bringing their valuable insights to readers. Originally from Singapore, Cindy is now based in Tbilisi, Georgia. She holds a Bachelor's degree in Communications & Media Studies from the University of South Australia and has a decade of experience in journalism and writing. Get in touch with her via [email protected] with press pitches, announcements and interview opportunities.

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