Venice AI raised a $65 million Series A at a $1 billion valuation on Wednesday, marking the privacy-first AI platform's first external fundraise. The round was led by crypto-focused venture firm Dragonfly, with participation from Coinbase Ventures, North Island Ventures, and others. The funding comes as the two-year-old company has achieved profitability with over $70 million in annualized run-rate revenues, more than 850,000 unique website visitors, 3 million active users, and an average of 1.7 million API calls per day. Venice AI offers access to more than 200 AI models while allowing users to retain privacy through encrypted routing and client-side data processing. CEO Erik Voorhees, an early bitcoin advocate and founder of cryptocurrency exchange ShapeShift, positions the platform as a neutral tool that respects user agency without content restrictions.
Venice AI Secures $65 Million Series A at $1 Billion Valuation
The Series A round was led by crypto-focused venture firm Dragonfly, with participation from Coinbase Ventures, North Island Ventures, and other investors. This marks Venice AI's first external fundraise since its founding two years ago. CEO Erik Voorhees told TechCrunch during an exclusive interview that the company is already profitable with annualized run-rate revenues exceeding $70 million.
Privacy-First Platform Hosts 200+ AI Models with Encrypted Routing
Venice AI hosts "uncensored" open-source models on its own data centers and routes queries to closed-source models such as those by OpenAI or Anthropic. All user input is encrypted and unencrypted client-side, and routed through an external proxy before processing and return, with no data stored on Venice's own systems. The company provides end-to-end encryption on some models, though users must pay for a subscription to access that feature. The platform allows users to freely choose from AI models that can generate text, images, audio, and video, all of which vary in performance, quality, and applied censorship levels.
Company Reports $70 Million Annualized Revenue and 3 Million Active Users
Venice AI has accumulated more than 850,000 unique visitors to its website and serves more than 3 million active users. The platform processes an average of 1.7 million API calls per day. Voorhees credited the company's growth to the performance of its crypto tokens and achieving near feature parity with ChatGPT. "When we launched, we were very far away from what ChatGPT could do, but people would use us because it was private. And today, we're very close to what ChatGPT can do […] so as we've closed that gap, it's become an increasingly compelling alternative," he said.
Venice AI Integrates Two Crypto Tokens for User Payments
The company operates two crypto tokens. Venice launched a token called "VVV" in early January to attract users, according to Voorhees. In August last year, the company added another token called "DIEM." Users can buy VVV and stake it to mint DIEM, which generates $1 worth of AI credits per day that can be spent on Venice. However, Voorhees said only about 8% of the company's users pay with crypto.
Company Plans GPU Purchases and Data Center Construction
Venice AI intends to use the fresh capital to start buying GPUs and building its own data centers. This move aims to stop leasing GPUs and increase gross margins. Voorhees, who has founded several crypto companies including bitcoin gambling site Satoshi Dice and cryptocurrency exchange ShapeShift, has long advocated for preserving user privacy. When asked about offering AI model access in light of recent AI-related concerns, he said his team treats their service as a "neutral tool or a neutral platform." "This is the same principle that you have in Bitcoin, where Bitcoin, as a neutral protocol, works the same way for all people," he said.
FAQ
What funding did Venice AI raise on Wednesday?
Venice AI raised a $65 million Series A at a $1 billion valuation on Wednesday, led by Dragonfly with participation from Coinbase Ventures, North Island Ventures, and others. This was the company's first external fundraise.
How many active users does Venice AI have?
Venice AI serves more than 3 million active users, has over 850,000 unique website visitors, and processes an average of 1.7 million API calls per day. The company reports annualized run-rate revenues exceeding $70 million.
What crypto tokens does Venice AI use?
Venice AI operates two crypto tokens: VVV, launched in early January, and DIEM, added in August last year. Users can buy VVV and stake it to mint DIEM, which generates $1 worth of AI credits per day. About 8% of users pay with crypto.
