Fal has raised $1.3 billion in a funding round led by Bessemer Venture Partners, valuing the San Francisco startup at $16 billion, according to Bloomberg. The new valuation is twice the $8 billion the company carried in April. Nvidia, Sound Ventures, and T. Rowe Price participated in the round.
The company disclosed its Series E and Series F rounds together, saying it brought in a combined $1.65 billion across the two. Sequoia led the earlier round. Fal hosts and runs AI video, image, and audio models.
The Series F funding arrives as demand climbs for inference services, the process of running an already-trained AI model to generate outputs. Customers relying on open source models have been a particular source of that demand. Fal passed $800 million in annualized revenue earlier this year, Bloomberg reported.
Other inference providers, including Baseten, Fireworks AI, and Modal, have likewise expanded quickly and raised large rounds at higher valuations. Their gross margins remain thin, though, because of the cost of buying or leasing compute, according to several people familiar with the financials of inference companies. That constraint applies across the inference business even as revenue grows.
Fal was founded in 2021 by Burkay Gur, previously a machine learning leader at Coinbase and an engineer at Oracle, and Gorkem Yurtseven, previously a developer at Amazon. The company's tools serve customers who need trained models operated on their behalf.
The startup's business sits in the US market for AI infrastructure, where inference providers compete for customers and for access to computing capacity. The round led by Bessemer Venture Partners more than doubles the capital Fal has taken in relative to its April valuation, and it places the company among the inference providers raising at higher valuations as demand for running open source models continues.
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