In a potential major investment move, Google is reportedly in advanced discussions to inject hundreds of millions of dollars into Character.AI, a thriving startup specializing in AI chatbots.
According to sources cited by Reuters, Character.AI seeks capital to enhance model training capabilities amid surging user demands.
The investment, possibly in the form of convertible notes, aims to deepen the collaboration between Character.AI and Google, with the startup currently leveraging Google's cloud services and Tensor Processing Units (TPUs) for model training.
Co-founded by ex-Google employees Noam Shazeer and Daniel De Freitas, Character.AI allows users to interact with virtual representations of celebrities and create their own chatbots.
While free to use, a $9.99/month subscription offers premium features.
The startup's diverse chatbots have resonated well with the 18 to 24 age group, constituting 60% of website traffic.
Character.AI, launched just six months ago, has already reported 100 million monthly visits.
In addition to Google, the startup is reportedly in talks with venture capitalists for equity funding, potentially valuing the company over $5 billion.
Meanwhile, Google has also increased efforts when it comes to investing in the AI-powered future.
Earlier this month, the tech giant was reported to have invested $2 billion in AI startup Anthropic as part of its broader plans to venture into the cloud computing market, traditionally dominated by Amazon and Microsoft.