Summarize this content to 2000 words in 6 paragraphs in Arabic Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Radical Ventures, the venture capital firm that helped to launch pioneering artificial intelligence start-up Cohere, has raised nearly $800mn to create the largest fund of its kind for AI. The Toronto-based venture capital firm’s third institutional fund will focus exclusively on growth-stage start-ups, according to people familiar with the plans. It raised $550mn last year to invest in early stage companies and $350mn in 2019. Radical’s investors include former Google chief Eric Schmidt’s family office, Stanford professor Fei-Fei Li, a computer scientist who has been dubbed the “godmother of AI”, and former Google Brain executive Geoffrey Hinton, as well as a number of Canadian pension funds, such as CPP Investments. CPP Investments said in public filings this week that it had committed $75mn to the new fund, bringing its total commitments to Radical to $204mn. The capital raise comes as some investors have started to question the likely returns from the billions of dollars that have flowed into AI start-ups in the wake of ChatGPT’s launch nearly two years ago. “There is certainly a hype cycle in some parts of venture and AI,” said Jordan Jacobs, co-founder and managing director of Radical Ventures. “But I think there’s going to continue to be a lot of money.”He added: “There are some truly giant future companies that are now transitioning from early stage to growth and feel we have the expertise and relationships to invest.” Jacobs declined to comment on the latest fundraising.Radical was launched in 2017, making it one of the earliest focused on investing exclusively in AI. The firm has since backed a string of fledgling AI companies that have grown rapidly as the technology has boomed. It was the first investor in AI start-up Cohere, which has since grown to a valuation of $5.5bn. Other portfolio companies include Covariant, a robotics foundation model, and drug discovery company Genesis Therapeutics.Venture capitalists have piled into AI companies in the past two years, even as broader start-up fundraising has been rocked by high interest rates, competition scrutiny on acquisitions and a largely frozen market for initial public offerings. AI investments drove a 47 per cent increase in US venture funding to $55.6bn in the three months to June, according to PitchBook, the highest quarterly total in two years.Radical was launched by Jacobs and Tomi Poutanen, who studied machine learning alongside Hinton at the University of Toronto. They previously ran a media start-up, Milq, which they sold in 2017 to Layer 6, the AI research lab of Canada’s TD Bank. The duo originally started Radical to back deep learning companies as angel investors. They then sold their company to invest in the technology full-time after the publication of “Attention Is All You Need”, a landmark AI research paper authored by a group of Google scientists, including Cohere co-founder and chief executive Aidan Gomez.“We believed after that paper that [AI] would cause a replacement cycle of software that would have an economic impact akin to an industrial revolution, and that it would also unlock science, which would be like a second industrial revolution,” said Jacobs. “Zero western investors were focused on it,” he added.
