Modal Labs Secures $750M Funding Round, Valuation Reaches $15.75B

Modal Labs has raised $750 million in a funding round led by Accel, increasing its valuation to $15.75 billion from a previous $4.65 billion just four months ago. The company, founded in 2021, reported annualized revenue exceeding $300 million as of May. Modal Labs serves notable customers including Cognition, Suno, Ramp, and Substack. In contrast, the inference startup Fireworks has achieved an annualized revenue of $1 billion, marking a fivefold increase from the previous year.

CEO Erik Bernhardsson and CTO Akshat Bubna confirmed that a security incident occurred in late July, where a customer inadvertently published an unauthenticated endpoint, allowing unauthorized access to their sandboxes. However, they clarified that Modal’s platform itself was not compromised. This funding round follows a previous raise of $355 million and is expected to support further growth and development in AI inference infrastructure.

Additionally, the valuation of Baseten, another inference startup, has doubled to $26 billion since June, indicating a robust interest in the AI inference market. With roughly 150 employees, Modal Labs is poised for significant expansion as it approaches its revenue milestone by year’s end.