Together AI Raises $800M: Open Source Cloud Takes Off

What Happened?

Together AI has announced the closing of an $800 million Series C funding round, led by Aramco Ventures — the venture capital arm of the Saudi oil giant. The round also included participation from Vista Equity Partners, General Catalyst, Emergence Capital, Nvidia, March Capital, Pegatron, and SentinelOne's S Ventures. This capital injection raises the startup's valuation to over $8 billion, according to sources close to the deal.

Founded in 2022, Together AI has positioned itself as the leading provider of cloud infrastructure optimized for open source artificial intelligence models. The company offers a platform that allows developers and businesses to train, fine-tune, and deploy models like Llama, Mistral, or Stable Diffusion without managing their own hardware. According to company data, Together AI already generates over $1 billion in annual recurring revenue (ARR), reflecting growing demand for open alternatives to the closed ecosystems of OpenAI and Google.

Why Is This Important?

This funding round marks several significant milestones in the AI ecosystem. First, it is one of the largest Series C rounds in the tech sector, surpassed only by those of OpenAI and Anthropic. The participation of Aramco Ventures, a non-traditional AI investor, suggests that large sovereign wealth funds are seeking exposure to AI infrastructure beyond established leaders. Additionally, the presence of Nvidia — the leading GPU manufacturer for AI — indicates that Together AI is becoming a key strategic partner for distributing computing capacity.

Together AI's business model is based on democratizing access to high-performance AI. While OpenAI and Google offer proprietary models through APIs, Together AI bets on open source, allowing customers full control over models and data. This is especially relevant for companies with strict privacy and data sovereignty requirements, such as those in finance, healthcare, or government sectors.

Market Implications

The $800 million injection will allow Together AI to scale its data center infrastructure, which currently operates in several regions worldwide. The company plans to expand its computing capacity with clusters of Nvidia H100 and B200 GPUs, as well as develop new tools to facilitate the deployment of large language models (LLMs).

This news also pressures competitors like Hugging Face, Replicate, or Modal, which operate in the same open source AI infrastructure space. Together AI's $8 billion valuation — with revenues already exceeding $1 billion — highlights that the market rewards companies that combine a robust platform with a solid revenue model. On the other hand, it reinforces the thesis that open source AI is not only commercially viable but can generate returns comparable to those of proprietary giants.

For end users, this competition translates into more options, lower prices, and greater transparency. Unlike proprietary models, open source ones allow independent audits, reducing risks of biases or unwanted behaviors.

What Readers Should Know

• It's not a bubble: Together AI already has real revenues of over $1 billion annually, partly justifying the valuation.
• Aramco Ventures bets on diversification: The Saudi fund seeks to invest in technologies that reduce oil dependence, and AI is a strategic bet.
• Nvidia strengthens its ecosystem: By investing in Together AI, Nvidia secures a sales channel for its GPUs and promotes the use of its CUDA platform.
• Open source vs. proprietary: The battle for AI hegemony intensifies, with Together AI as the standard-bearer for the open model against OpenAI and Google.

Historical Context

Since the emergence of ChatGPT in 2022, the AI sector has experienced an unprecedented investment frenzy. In 2023 and 2024, generative AI startups raised over $50 billion in funding, according to CB Insights data. However, most of that capital has been concentrated in proprietary model companies. Together AI represents an alternative that demonstrates open source can also attract massive investments.

Together AI's round echoes Hugging Face's in 2023, which reached a $4.5 billion valuation, but with the difference that Together AI already has substantial revenues and a business model more oriented toward infrastructure than community.

"Together AI has shown that you can build a multi-billion dollar business around open source, something many considered impossible just a few years ago" — analyst at TheVortiq.