Contextual AI Raises $80M Series A to Scale Production-Grade LLMs for Enterprises

Contextual AI has announced the completion of a $80 million Series A investment round in the enterprise space. The company’s ambitious goal to transform workplace productivity with cutting-edge AI technologies—particularly in knowledge-intensive tasks—will be fuelled by this large investment.

We’re excited to share today that we’ve raised $80M in Series A funding to accelerate our mission to change the way the world works through AI. Read more at our blogpost: https://t.co/aTLx0NmQfr pic.twitter.com/dGSqyZeeFg

— Contextual AI (@ContextualAI) August 1, 2024

Contextual AI, which was founded a little more than a year ago, has quickly become a leader in the corporate AI market. The formation of an elite workforce that is both AI- and enterprise-native, the company’s successful enterprise AI platform deployments with top Fortune 500 businesses, and its ground-breaking research, especially in RAG 2.0 technology, have all contributed to its rapid growth.

Contextual AI’s turnkey platform, which enables businesses to quickly develop cutting-edge RAG 2.0 applications, is the foundation of its solution. This platform offers complete customisation through end-to-end machine learning, and it performs better right out of the box than what the business refers to as “Frankenstein’s RAG”. Significantly, the platform may be used on-premises or on Contextual AI’s secure SaaS infrastructure, resolving important security issues for businesses handling sensitive data.

“While developing RAG prototypes is relatively easy today, building production-grade AI systems at scale remains a massive challenge for enterprises,” the company stated. “This is especially true in high-stakes settings that require high accuracy, with a low tolerance for hallucinations.”

The company’s approach, spearheaded by CEO Douwe Kiela, a pioneer in RAG technology with extensive experience at Microsoft Research, Meta/Facebook AI Research, and Hugging Face, focuses on two key principles: prioritizing systems over models and specialization over AGI. Partnering with CTO Amanpreet Singh, a close collaborator at both Meta and Hugging Face, they co-founded Contextual AI to bring production-grade AI to the enterprise.

Using RAG 2.0 as training data, this approach has produced Contextual Language Models (CLMs). The Contextual AI Platform is powered by these CLMs, which enable more accurate and well-founded applications than could be achieved with crude RAG implementations.

The influence of contextual AI is already seen from its partnerships with major players in the market. A multi-year contract has been signed by Qualcomm to implement a customer engineering application driven by CLM, which has greatly increased the accuracy of obtaining complicated technical documents. Customer engineers throughout the world will utilise the program to get data from tens of thousands of extremely technical papers from various business divisions and product lines.

Yogi Chiniga, VP of Customer Engineering at Qualcomm, expressed confidence in the technology, stating, “With their RAG 2.0 technology, deep expertise and proven results to date, Contextual AI gives me confidence that we can leverage generative AI to support our team, help our customers design and develop products efficiently, and set new standards for performance and quality.”

HSBC is partnering with Contextual AI to leverage its technology for AI-assisted knowledge management, particularly in areas like research insights and process guidance support. Ian Glasner, Group Head of Emerging Technology, Innovation, and Ventures at HSBC, praised the company’s capabilities, saying, “Contextual AI’s language models, fine tuning, and feedback learning capabilities combine to deliver a product that will create value in many industries.”

The Series A funding round was led by existing investor Greycroft, with participation from other seed investors including Bain Capital Ventures, Lightspeed, Lip-Bu Tan, Conviction/Sarah Guo, and Recall Capital. New investors joining the round include Bezos Expeditions, NVentures (Nvidia), HSBC Ventures, and Snowflake Ventures. The company also announced the addition of Marcie Vu, known for her role in taking Google and Facebook public, to its board.

Marcie Vu, Greycroft Partner, expressed enthusiasm about the partnership, stating, “We are thrilled to deepen our partnership with Contextual AI and founders Douwe and Amanpreet to seize a generational market opportunity. When Greycroft invested in their seed financing, we foresaw the potential of RAG technology to revolutionize AI in the enterprise.”

As Contextual AI scales its operations and accelerates its go-to-market strategy, the enterprise AI landscape appears to be growing. In an interview with Reuters, Douwe Kiela said, “We don’t have to explain it anymore.”