Aleph Alpha Secures $500 Million in Funding to Challenge OpenAI

German startup Aleph Alpha has raised $500 million in a series B funding round, with support from major companies such as Bosch, SAP, and Hewlett Packard Enterprise, the company announced Monday (Nov. 6).

The company, which has developed its own large language models, aims to compete with Microsoft-backed OpenAI. Aleph Alpha’s funding round is particularly noteworthy for a series B investment, indicating the growing interest and excitement surrounding advanced AI models. This investment will be utilized for research on foundation models, enhancing product capabilities and expanding commercialization efforts.

Data Sovereignty

Aleph Alpha’s technology is centered around the concept of “data sovereignty,” which emphasizes that data stored in a specific country should be subject to that country’s laws. In the European context, this means ensuring that the data powering AI models is grounded in Europe, rather than being reliant on the U.S. Aleph Alpha’s CEO and founder, Jonas Andrulis, believes that the company is the best option for organizations that prioritize data sovereignty. The startup’s models are already capable of communicating in multiple languages, including German, French, Spanish, Italian and English. The training data includes a vast repository of multilingual public documents published by the European Parliament.

The recent funding round for Aleph Alpha highlights the intense activity taking place in the venture capital landscape surrounding AI. Investors are eager to support companies developing advanced AI models, particularly generative AI, which can provide human-like responses to a wide range of queries. OpenAI raised a staggering $10 billion, while Inflection, a startup founded by the minds behind DeepMind and LinkedIn, secured $1.3 billion.

Aleph Alpha’s Funding Consortium

The series B funding round for Aleph Alpha involved a broad consortium of investors. The Innovation Park Artificial Intelligence (Ipai), Bosch Ventures, and Schwarz Group led the investment. Other notable participants include SAP, Hewlett Packard Enterprise, Christ&Company Consulting, and Burda Principal Investments. The total funding of over $500 million encompasses applied research, joint business development, and preconsumption licenses with industry leaders within the consortium.

Aleph Alpha’s advancements in Large Language Models offer government agencies and companies the opportunity to build and apply AI in a sovereign environment. The company combines data protection, security, and unique explainability and customization options.