Upstage raises $72 million to invest in enterprise AI

Korean AI startup Upstage raised $71.7 million in Series B funding from domestic and international investors. It plans to expand its enterprise-specific large language models.

Upstage logo [UPSTAGE]

Korean AI startup Upstage raised 100 billion won ($71.7 million) in Series B funding from a group of investors at home and abroad, including SK Networks, KT and SBVA, formerly SoftBank Ventures Asia.

Korea Development Bank, Shinhan Venture Investment, Hana Ventures, Mirae Asset Venture Investment and Industrial Bank of Korea also led the Series B round.

Prior investors Primer Sazze Partners, Company K Partners and Premier Partners also participated in the funding.

Upstage plans to use the funds to respond to the rising demand for enterprise-specific large language models (LLMs) through its U.S. subsidiary, which was formed in February. Additionally, it aims to expand the AI ecosystem based on its homegrown foundation model Solar through advancing open source projects such as data preprocessing and LLM evaluation platforms.

Upstage has raised a total of 140 billion won since its founding in October 2020, the largest amount of investment attracted by a domestic software company, per Upstage's research.

“Despite the challenging investment climate, Upstage solidified its status as a leading generative AI company,” Upstage CEO Kim Seong-hoon said in a statement. “Through this investment, we will evolve into a company that achieves results and recognition on the global stage beyond Korea, including the United States, Japan and Southeast Asia, while continuously advancing Solar to become the world’s leading language model.”

The AI startup attributed the financing to the success of its enterprise-focused AI program Document AI, which provides automated document processing and personalized search services, as well as the global recognition of Solar’s capabilities among global LLM evaluation platforms.

Meanwhile, Meta praised Upstage’s LLM capabilities on its official blog on Monday, introducing it as an exemplary case to have utilized Meta’s open-source model Llama 2 to fine-tune the Korean company’s foundation algorithm.

Upstage’s Solar was also mentioned as a lightweight, cost-efficient model 2.5 times faster than OpenAI’s ChatGPT 3.5.

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]