The Information's TITV
00:21:38 · Ken Gawrelski
[00:21:38] S2: Yeah, I think the way we look at this is the payback periods and the return profile. Right? And this is not a static thing. Right? Because we can, in a moment in time, we'll say, okay, here's what we think the return profile is for the cohort of investments of CapEx in '26, in 2026. But then as market conditions change, both the revenue that they can attain for that capacity, but also the cost. And this has been a big issue. Right? You've seen supply chain inflation, memory, all along the supply chain. And so the key is to continue to monitor this. This is an ongoing thing. What we see here is this. We've done this work. We we see high teens IRRs on on... And on compute capacity investment. We're talking about a three to four year payback period. That is longer than you would might hear out of a SpaceX, for example, where they're talking about one to two two year paybacks, maybe even shorter than that. But I think there's a difference here, which is Amazon and AWS is doing longer dated contracts, longer term agreements that are not right at the, you know, spot market price. So we... What we do is we track to make sure that over time, these return profiles are steady to improving. And what we see so far is, if anything, would say a bit of an improvement in return profile. Some of that I think is because you have... We talked about the training chips at Amazon. You talk about the TPUs at Google. I think these alternative sources of supply, proprietary sources of supply, are allowing some of the return profiles to improve for these hyperscalers.
00:23:33 · Akash Pasricha, Joelle Pineau
[00:23:33] S0: Great. Well, I want to thank you for coming on. That is Ken Gawrelski from Wells Fargo here on TITV. Canadian AI startup Cohere is looking to raise around $7,000,000,000 Canadian, that is roughly $5,000,000,000 U. S. In a new funding round that would value the company at roughly 26,000,000,000 U. S. Dollars. The company announced an initial close. I want to bring on Joelle Pineau, Chief AI Officer at Cohere for a conversation. Joelle, welcome back to the show. It's great to have you here. [00:24:05] S3: Good morning. Great to see you. [00:24:07] S0: So how much of this target have you actually raised so far? [00:24:13] S3: Well, we've actually raised the majority of the target. I'm not going to go into the details of where we are, but definitely, you know, we're well on our way towards that. [00:24:21] S0: But like six of the seven? Six of the seven maybe? [00:24:25] S3: I will leave it to my CFO to decide when he wants to share the numbers, but definitely, you know, more than half of that and and well on our way to the target and and and a lot of interest, frankly, in terms of people who are seeing the value in Sovereign AI, seeing the value in giving customers autonomy over how their technology is built, where it's deployed, where the data is stored, really resonates really well with investors. So we just want to be a little bit more out there in terms of how we're doing and progressing and what's our what's our target. And also really gives us an opportunity to talk about what we want to build with those investments.
00:24:25 · Joelle Pineau, Akash Pasricha
[00:24:25] S3: I will leave it to my CFO to decide when he wants to share the numbers, but definitely, you know, more than half of that and and well on our way to the target and and and a lot of interest, frankly, in terms of people who are seeing the value in Sovereign AI, seeing the value in giving customers autonomy over how their technology is built, where it's deployed, where the data is stored, really resonates really well with investors. So we just want to be a little bit more out there in terms of how we're doing and progressing and what's our what's our target. And also really gives us an opportunity to talk about what we want to build with those investments. [00:25:02] S0: So talk about that to them. What do you want to build? Because you spotlighted... I mean, the product roadmap is one thing, but you said invest in long term compute infrastructure, which is kind of interesting because Sovereign AI, I mean, part of the value prop for you guys is that they're running it on their own systems. So what exactly is the compute infrastructure that you want to build?
00:25:02 · Akash Pasricha, Joelle Pineau
[00:25:02] S0: So talk about that to them. What do you want to build? Because you spotlighted... I mean, the product roadmap is one thing, but you said invest in long term compute infrastructure, which is kind of interesting because Sovereign AI, I mean, part of the value prop for you guys is that they're running it on their own systems. So what exactly is the compute infrastructure that you want to build? [00:25:23] S3: First and foremost, we're really committed to our modeling roadmap, the ability to build frontier models. And in some cases, it's very specific capabilities. In the past, we've focused on multilingual capabilities. Now we have a lot of efforts around cybersecurity space as well as enterprise use cases, which can be quite different from some of the consumer AI. And so a lot of that infrastructure, obviously, to continue to have a really ambitious roadmap in terms of training larger models, generic synthetic data to train those models. But there's also definitely an appetite as AI grows to adopt our solutions for small medium businesses who may want to lean on us for compute and also, you know, to provide a greater number of inference solutions. So those are some of the things that will certainly come into the picture as we go. Right now, we've shared actually is our commitment to build some of that compute in Canada, which is part of the government of Canada's involvement in this funding round.
00:25:23 · Joelle Pineau, Akash Pasricha
[00:25:23] S3: First and foremost, we're really committed to our modeling roadmap, the ability to build frontier models. And in some cases, it's very specific capabilities. In the past, we've focused on multilingual capabilities. Now we have a lot of efforts around cybersecurity space as well as enterprise use cases, which can be quite different from some of the consumer AI. And so a lot of that infrastructure, obviously, to continue to have a really ambitious roadmap in terms of training larger models, generic synthetic data to train those models. But there's also definitely an appetite as AI grows to adopt our solutions for small medium businesses who may want to lean on us for compute and also, you know, to provide a greater number of inference solutions. So those are some of the things that will certainly come into the picture as we go. Right now, we've shared actually is our commitment to build some of that compute in Canada, which is part of the government of Canada's involvement in this funding round. [00:26:30] S0: So tell me about your outlook then on the many different options for chips that you have available to you that are coming online? I'm sure you're using NVIDIA. Are you using chips other than NVIDIA?
00:26:30 · Akash Pasricha, Joelle Pineau
[00:26:30] S0: So tell me about your outlook then on the many different options for chips that you have available to you that are coming online? I'm sure you're using NVIDIA. Are you using chips other than NVIDIA? [00:26:46] S3: We are definitely using NVIDIA chip. I would say that's the bulk of it. We've also had some really good results working with AMD chips. And beyond that, I would say a lot of what we're doing is looking at the possibilities. We've, you know, we've considered using TPUs and others in the past. And so we're always, you know, for us, it's really about benchmarking the performance of that. Between training and inference, the needs can be a little bit different also. And then we increasingly are generating more and more synthetic environments, synthetic data. And so that in some cases opens up the possibilities. [00:27:19] S0: What about some of these smaller inference focused chips, you know, SambaNova, Cerebras, d-Matrix, you're talking to any of them? [00:27:27] S3: We are definitely talking to them. I wouldn't say we have huge amount of our workflows on them right now, but we are talking to them or keeping an eye on what's going on over there, definitely. [00:27:38] S0: Right. And, I mean, you talked about the growth of the company as well in the announcement. So where is the run rate at right now for the company?