Cohere and CoreWeave to Build Multibillion-Dollar AI Data Center in Canada with Government Support

Cohere and CoreWeave Announce Multibillion-Dollar AI Data Center Project

Artificial intelligence startup Cohere Inc. has revealed plans to partner with CoreWeave Inc. in constructing a multibillion-dollar data center in Canada. This significant development comes with substantial financial backing from the Canadian government, marking a major step in the country's AI infrastructure expansion 1

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Project Details and Government Support

While the exact location of the new AI data center remains undisclosed, the project is set to receive considerable support from the Canadian government. As part of its C$2 billion Canadian Sovereign AI Compute Strategy, the government has pledged up to C$240 million ($170 million) in support for Cohere 2

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Francois-Philippe Champagne, Canada's innovation minister, expressed enthusiasm for the project, stating, "Canadian champions drawing in billions of dollars in investment to build infrastructure is a home run when it comes to putting policy in action" 2

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Cohere's Investment and Expansion

Cohere is expected to make a significant investment in the project, aiming to enhance its model training capabilities and secure computing power within Canada. The data center will not only serve Cohere's needs but also provide capacity for other players in the AI industry 2

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Company Profile and Growth

Founded in 2019 by Aidan Gomez, Nick Frosst, and Ivan Zhang, Cohere has quickly become one of Canada's largest startups. With dual headquarters in Toronto and San Francisco, the company boasts a valuation exceeding $5.5 billion and employs approximately 400 people 1

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Cohere has raised an impressive $970 million from a diverse group of investors, including tech giants like Nvidia Corp., Oracle Corp., and Cisco Systems Inc., as well as the Public Sector Pension Investment Board and Montreal-based investment firm Inovia Capital 2

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Business Model and Revenue Growth

Initially focused on using large language models to generate text from prompts for businesses, Cohere is now shifting its strategy. In a recent letter to employees and investors, CEO Aidan Gomez outlined the company's plans to develop more tailored and secure models, addressing the challenges businesses face in implementing generative AI 2

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The company has demonstrated strong revenue growth, with annualized revenue reaching $35 million by the end of March, a significant increase from $13 million at the end of 2023 2

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Implications for Canada's AI Ecosystem

This project represents a major boost for Canada's AI ecosystem and its ambitions to become a global leader in artificial intelligence. By attracting substantial investments and fostering partnerships between innovative startups and established tech companies, Canada is positioning itself at the forefront of AI research and development.