Sakana AI has achieved a ?400 billion ($2.6 billion) valuation after raising ?20 billion in a recent funding round, and notes that it is now Japan¡¯s largest startup ever.
The new investment and the sky-high valuation come as AI mania grips markets globally and drives shares of publicly traded AI-related companies to unprecedented levels. Nvidia now has a market capitalization of more than $4.5 trillion.
It also comes as more questions are raised about AI and whether it will deliver on its promises and generate enough profit to justify all the capital being committed to it.
Major investors in the latest Sakana AI round include Lux Capital, Khosla Ventures and New Enterprise Associates. Mitsubishi UFJ Financial Group (MUFG), the CIA¡¯s In-Q-Tel (IQT) and Santander Group are also investors.
Tokyo-based Sakana AI said that IQT will help it enter the defense and intelligence markets amid Prime Minister Sanae Takaichi¡¯s plan to rapidly increase defense spending in Japan, which will provide a ¡°tailwind¡± for the company.
Leveraging its relationship with Santander Group, Sakana AI hopes to work with financial institutions globally. It reached an agreement with MUFG in May to automate the creation of banking documents, including credit approval memos.
Sakana AI is also looking to use its new funding to develop AI models that can handle the ¡°uniquely Japanese ways in which we communicate,¡± such as in the use of honorifics, said Yuta Tamaru, the company¡¯s corporate operations manager.
The startup will use some of the capital recently raised to help it speed up its hiring of employees in Japan, where the ¡°AI talent pool is smaller¡± when compared to other markets, said Ai Fujiki, Sakana AI¡¯s head of corporate development, adding that the challenge moving forward will be to find people who can speak Japanese and conduct business in Japan.
The company, which is led by CEO David Ha ¡ª a Canadian who received a doctorate from the University of Tokyo and an undergraduate degree from the University of Toronto ¡ª has about 100 employees.
Sakana AI bills itself as an AI research company.
In a blog post about its recent funding, it said it has developed self-improving AI models, ways to get open-source models to work together and AI for academia that handles ¡°tasks from hypothesis generation to paper writing.¡±
¡°Our research has focused on developing efficient AI technology sustainably,¡± the blog post reads.
¡°For instance, rather than reinventing the wheel by training yet another large foundation model from scratch, we instead pioneered ways of using evolution to combine existing open-source models, using tree search to combine closed models, getting models to self-improve, to push the frontier of AI capabilities.¡±
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