OpenAI’s European Rival Aleph Alpha Raises $500M in Series B Funding Round

German startup Aleph Alpha announced on Monday that it has raised $500 million in a Series B funding round backed by Bosch Ventures, SAP, Hewlett Packard Enterprise, Innovation Park Artificial Intelligence (Ipai), and others. The Heidelberg-based firm did not disclose its valuation in the raise.

The company, which has been touted as Europe’s answer to OpenAI, was founded in 2019 and provides business-to-business (B2B) and business-to-government (B2G) AI solutions. It has developed its own large language models and will invest the cash injection in research on foundation models, advanced product capabilities, and commercialization of its software.

Founder and CEO Jonas Andrulis said in a press release:

“With this latest investment, we will continue to enhance our capabilities and enable our partners to be at the forefront of this technological development. To empower customers, Aleph Alpha will continue to expand its offerings while maintaining independence and flexibility for customers in infrastructure, cloud compatibility, on-premise support and hybrid setups. The ongoing developments will extend interfaces and customization options tailored to business-critical requirements.”

The startup has been pushing a concept called “data sovereignty” which is the idea that data stored in a certain country is subject to that country’s laws. The concept has become increasingly popular among European politicians and legislators who wish to be independent of the United States when it comes to data storage and management. Andrulis believes that “for customers with a significant responsibility and in strategic environments where sovereignty is at risk,” Aleph Alpha is the best option.

Echoing the sentiment, Dr. Tanja Rückert, Member of the Board of Management and Chief Digital Officer of Robert Bosch GmbH says:

“Actively developing Generative AI will be crucial for Europe’s technological sovereignty. That’s why we at Bosch are opening fields of application and business models and playing a key role in shaping this cutting-edge technology together with other companies such as Aleph Alpha.”

The data used to train Aleph Alpha’s models is stored in Europe and includes a large repository of multilingual public documents published by the European Parliament. Currently, the models can communicate in English, French, German, Italian, and Spanish.

The $500 million raise has been noted to be uncommonly large for a Series B round and is a testament to the frenzy in AI venture capital. Investors worldwide are scrambling to back generative AI projects. ChatGPT creator has raised $10 billion while Inflection, an AI startup co-founded by the founders of DeepMind and LinkedIn, has raised $1.3 billion.