Cohere is one in a group of AI startups reviving San Francisco’s commercial real estate sector. Now the Canadian company is coming to New York City, too, as AI looks to expand its footprint in the Big Apple.
New York City is the third-hottest real estate market for AI startups behind Austin and San Francisco and is getting hotter. AI companies contributed to 1.7 million square feet of new demand for office space in the city in January, Commercial Observer reported. On top of Cohere’s new office opening, reports surfaced last week that OpenAI is looking to lease 60,000 square feet of office space in New York. AI video-editing startup Captions, started by a former Microsoft engineer, secured a lease this week.
A rival to OpenAI, Cohere makes multilingual large language models. It’s raised more money — from big names such as Nvidia, Oracle, and Salesforce — than any startup other than OpenAI and Anthropic. Cohere is also reportedly in talks to raise as much as $1 billion in fresh funding from investors, the Financial Times reported in January. AI startups have been in expansion mode as classic tech firms shed workers and undergo restructuring to keep up.
But while more AI startups may be snatching up office spaces, most of the companies are still headquartered in California. Some 26 of the country’s top 100 AI companies are headquartered in California, while only 6 are in New York, according to a report from commercial real estate agency Cushman & Wakefield.
While Cohere has 300 employees, only 30 work at its New York office so far. “Cohere has increased headcount in New York by more than [three times] since the start of the summer and we continue to actively hire in New York,” a spokesperson told Quartz in an email Friday (Mar. 1).
Quotable: Chuck Schumer is happy about AI in NYC
“Cohere is an exciting and innovative firm and they will be a great addition to New York’s booming tech sector. I’m glad to see New York at the forefront of American-led AI innovation, and I look forward to continuing our work in the Senate to safely harness this technology for the benefit of all.” — U.S. Senate Majority Leader Chuck Schumer
By the numbers
$445 million: Capital raised by Cohere, compared to Anthropic’s $450 million, and far behind OpenAI’s $11.3 billion
6: Number of the biggest American AI startups headquartered in New York City
5.6 million: Square feet of office space in lease by AI companies in New York in as of the third quarter of 2023, according to Cushman & Wakefield
7%: How much AI could boost global GDP over the next decade (equivalent to $7 trillion), according to Goldman Sachs
Editorial note: This article was updated to include a comment from Cohere.