Distyl AI Secures $175M in Series B Funding, Reaching $1.8B Valuation

Distyl AI Raises $175M Series B At $1.8B Valuation, Up 9x From Last Funding

Distyl AI, a startup that aims to help Fortune 500 companies become "AI-native," has raised $175 million in a Series B funding round at a $1.8 billion valuation. Khosla Ventures and Lightspeed Venture Partners led the round, with Coatue, Dell Technologies Capital and DST Global also participating in the financing, bringing the San Francisco-based startup's total raised since its 2022 inception to just over $200 million, per Crunchbase data. That's a massive jump from the $200 million it was valued at last November when it raised a $20 million Series A led by Lightspeed. Distyl AI says it works with companies in a variety of sectors, including healthcare, telecommunications, insurance, manufacturing and financial services. "The companies that win in the AI era are those that are willing to reimagine how they operate, not just what tools they use," said Arjun Prakash, CEO of Distyl AI, in a written statement. "AI is forcing enterprises to move beyond silos. ... Our belief is that the next chapter of AI leadership won't be won by the models alone, but by operationalizing AI at scale in enterprises and transforming how they work." While Distyl did not disclose exact figures, it says it grew revenue by 5x in 2024 and is on track to grow it by 8x in 2025, adding that it has reached over 120 million end users since its inception. The company was founded by Prakash and Derek Ho, both of whom previously worked at Palantir Technologies.

Enterprise AI consultancy Distyl AI's valuation soars to $1.8B after bumper funding round - SiliconANGLE

Enterprise AI consultancy Distyl AI's valuation soars to $1.8B after bumper funding round Artificial intelligence startup Distyl AI Inc. is growing its reputation as an AI consultancy that delivers real and rapid results for enterprises after closing on a bumper $175 million funding round at a $1.8 billion unicorn valuation today. The round was led by Lightspeed and Khosla Ventures and saw the participation of Coatue, Dell Technologies Capital and DST Global as well, bringing the startup's total amount raised to just over $200 million. Distyl AI's round was first reported by The Information, which notes that the startup has helped major enterprises such as T-Mobile USA Inc. successfully implement a number of value-generating AI projects. The company was founded in 2022 by Arjun Prakash and Derek Ho, who previously made their names at the data mining firm Palantir Technologies Inc. It has forged a growing reputation as the consultancy to call when enterprises realize that they're not getting enough out of their endless AI pilots, and that it's time to start showing results. The founders say they've combined their years of experience in building complex data platforms at Palantir with a staff of talented AI engineers and researchers who earned their chops at companies like OpenAI and Apple Inc. Distyl AI specializes in integrating AI directly into its customer's core business processes, and says it's capable of building AI systems that can start delivering millions of dollars in savings or revenue generation. Its efforts center on its Distillery AI Engine, which can be embedded into enterprise's existing computing systems and applications and start automating various aspects of their work. It claims that these "AI Routines" can be gotten up and running in weeks rather than months or years. With Distillery, AI algorithms create the automated processes by studying customer's business operations and working out how they can be performed by AI agents instead of human workers. The engine taps into each customer's proprietary data to ensure these agents possess the "organizational knowledge" needed to do this work. It provides comprehensive observability too, so companies can track every single input and output and gain visibility into the AI's decision-making processes. Each AI workflow it builds is carefully evaluated, both in terms of its performance, and also for its reliability and correctness. Guardrails are also implemented to prevent the AI models from going askew and "hallucinating". Chief Executive Prakash told The Information that the startup builds "outcome-driven partnerships" with its clients. The focus is on integrating AI in such a way that it can immediately begin automating workloads and solving their biggest business challenges, rather than having consultants sit in boardrooms for months on end just talking about how it might be done. Notably, it collaborates closely with OpenAI to adapt that company's most advanced foundation models for real-world deployments. The partnership with OpenAI has helped Distyl AI to land numerous clients in industries spanning telecommunications, insurance, retail, manufacturing and healthcare, the startup says. In one case study, it claims to have helped an unnamed hardware manufacturer increase the time it takes to perform a root cause analysis of supply chain disruptions by 80%. In another, it says it helped a healthcare payor to improve its analysts' investigation times and deliver more than $23 million in annual savings. Today's round represents a massive jump that reflects the company's rapid rise over the last year. In November, it raised $20 million in an investment that was also led by Lightspeed, having closed on a $7 million seed funding round in April 2023. Clearly, Distyl AI's backers believe it's about to hit the big time, and they say they're confident that it can help itself to a generous slice of the projected $300 billion market for enterprise AI, which is growing by approximately 20% each year. The startup's advantage over traditional consultancies is that it helps enterprises implement AI more successfully, with smaller teams, and at lower costs. If that's true, it's a compelling proposition for organizations that are falling over themselves in the race to AI automation. Prakash said he already knows how he's going to spend the money from today's round, with plans to grow its team, refine the Distillery AI Engine and expand its strategic partnerships with AI developers.