Magic AI Secures $117 Million to Build an AI Software Engineer

Magic AI Secures $117 Million to Build an AI Software Engineer

San Francisco-based startup Magic AI has raised $117 million in Series B funding to further develop its advanced AI system aimed at automating software development.

The round was led by Nat Friedman and Daniel Gross’s NFDG Ventures, with additional participation from CapitalG and Elad Gil. This brings Magic’s total funding to date to over $145 million.

Founded in 2022 by Eric Steinberger and Sebastian De Ro, the startup is carving out a niche by focusing on developing an AI software engineer capable of assisting with complex coding tasks and that will act more as a coworker than merely a "copilot" tool.

The founders believe that in addition to boosting practical coding productivity, advancing intelligent code generation tools can also provide a path toward more expansive artificial general intelligence. Their vision even extends to the creation of broadly capable AGI systems that align with human values - ones able to accelerate global progress by assisting with humanity's most complex challenges. Their $23 million Series A round last summer was a major step towards this ambitious mission.

Central to Magic's technical strategy is handling exceptionally large context windows. Last year, they unveiled their Long-term Memory Network (LTM Net) architecture and corresponding LTM-1 model with a 5 million context window.

For perspective, most language models operate on far more limited contexts, commonly less than 32k tokens. OpenAI's powerful GPT-4 Turbo model is 128k tokens and Anthropic's Claude 2.1 is 200k.

However, models with much larger context windows are on the horizon. Just yesterday, Google announced that their new Gemini 1.5 model will have a 1 million context window, and shared that they have tested up to 10 million context lengths in research.

The substantially larger context capacities allow for more nuanced code comprehension - enabling Magic's model to reason over entire repositories and dependency trees to boost usefulness.

The startup continues to operate in stealth mode with few public demos, but claims to already have thousands of GPUs deployed toward training its next generation models.

Now, with fresh funding in hand, talent recruitment and retention is clearly top of mind for Magic AI’s leadership. The startup is actively seeking talented individuals who share its vision of integrity and innovation and is placing a strong emphasis on cultivating a supportive culture rooted in passion.

With towering investor confidence and transformative ambitions, Magic AI remains one of the most intriguing AI startups amid a landscape filled with heated competition. Still, Magic believes its technical approach focused on extreme model scale and novel neural architectures sets it apart.

Chris McKay is the founder and chief editor of Maginative. His thought leadership in AI literacy and strategic AI adoption has been recognized by top academic institutions, media, and global brands.

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