Sierra, the AI startup co-founded by former Salesforce co-CEO and OpenAI chairman Bret Taylor, has achieved a valuation of $4.5 billion following a successful funding round.
What Happened: On Monday, a year after its public launch, Sierra raised $175 million in a funding round led by Greenoaks Capital, reported Reuters.
Thrive Capital and Iconiq also participated in the round. The company had previously raised $110 million from Sequoia Capital and Benchmark at a nearly $1 billion valuation.
Despite growing concerns around AI bubbles, the funding has positioned Sierra as one of the most highly valued startups. The company has surpassed $20 million in annualized revenue, the report noted, citing sources familiar with the matter.
This latest funding round values Sierra higher than established brands such as Nikon Corp. NINOY and Macy’s, Inc. M, which have market capitalizations of $4.43 billion and $4.30 billion, respectively.
Co-founded by Taylor and Google veteran Clay Bavor, Sierra specializes in selling AI-powered customer service chatbots to enterprises. It serves clients such as WeightWatchers WW and SiriusXM Holdings Inc SIRI.
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Why It Matters: Sierra’s skyrocketing valuation comes amidst a surge in funding for AI startups. For instance, earlier this month ChatGPT-parent OpenAI secured more than $6.5 billion in new funding at a valuation of $157 billion.
In March this year, Amazon.com, Inc. AMZN announced an additional $2.75 billion investment in Anthropic. This follows an initial $1.25 billion investment from Amazon in September 2023, raising its total commitment to $4 billion.
At the time, the investment was made based on Anthropic’s valuation of $18.4 billion.
In May 2024, Elon Musk’s AI startup xAI raised a staggering $6 billion in its Series B funding round, pegging a reported valuation of $24 billion.
In July, Cohere Inc., backed by Nvidia Corporation NVDA reached a $5.5 billion valuation becoming one of Canada's largest startups.
Photo Courtesy: Sierra AI
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