Fal.ai, the startup that hosts AI models for developers working with images, video, and audio, just closed a huge new funding round that pegs the company’s valuation at over $4 billion, according to four sources close to the deal. Two of those people said the company actually raised around $250 million.
Sources told us that Kleiner Perkins and Sequoia were the major investors in this round. Fal didn’t reply when we reached out for comment, and both Sequoia and Kleiner Perkins declined to comment.
This massive new round comes barely three months after Fal announced a $125 million Series C that valued them at $1.5 billion, a round led by Meritech. At that time, Fal’s revenue already exceeded $95 million, and over two million developers were using its platform, according to Todd Jackson, a partner at First Round Capital, who wrote about it on LinkedIn. That marks explosive growth from just a year ago, when TechCrunch reported Fal had $10 million in annual recurring revenue (ARR) and 500,000 developers.
Fal provides the underlying infrastructure for multimodal AI models (along with media-specific ones), so the company’s wild growth ties directly to how fast people are adopting the applications built on top of it. Multimodal AI is red hot right now, particularly video, which we saw when OpenAI’s Sora surged to the top of the U.S. App Store even faster than ChatGPT did. This huge consumer demand for apps like Sora shows the massive market potential of what Fal offers.
Fal says it offers developers access to more than 600 image, video, audio, and 3D models, and boasts that its cloud runs on thousands of Nvidia H100 and H200 GPUs, fine-tuned for super-fast inference. They also offer tools that let developers customize these models. Developers can access its offerings via an API, through a flexible serverless option, or using enterprise-ready compute clusters. Sure, other companies like Microsoft, Google, and CoreWeave offer model and app hosting, but Fal’s singular focus on media and multimodal AI is its main competitive edge, according to VCs like Jackson.
The startup’s customer list spans everyone from independent developers to major companies, including Adobe, Canva, Perplexity, and Shopify. People use the platform for popular applications like creating media for advertising, e-commerce, and gaming content.
Burkay Gur, a former Coinbase machine learning leader and Oracle engineer, co-founded the startup in 2021 with Gorkem Yurtseven, who previously worked as a developer at Amazon. Gur and Yurtseven spotted an opportunity in personalized multimedia generation. While other technologists chased LLMs, they focused on optimizing Stable Diffusion for speed and scale and have since broadened their scope to host many other similar models.
Fal had previously raised almost $200 million, according to PitchBook data. The company’s existing investors include Bessemer Venture Partners, Kindred Ventures, Andreessen Horowitz, Notable Capital, First Round Capital, Unusual Ventures, and Village Global.
