Canada Will Take an Equity Stake of Up to C$1.6 Billion in Cohere, Whose Series E Targets C$7 Billion at a C$35.7 Billion Valuation
Cohere announced the initial close of a Series E round targeting up to C$7 billion at a C$35.7 billion valuation, led by Germany's Schwarz Group. Canada's government will invest up to C$1.6 billion in stages, tied to commitments that Cohere create 1,000 Canadian jobs, spend C$1.7 billion on Canadian compute by 2030 and keep its headquarters in Canada. Cohere has not said how much is committed so far.
Canada is buying into its own AI lab rather than only subsidizing it, and the conditions attached say what the government wants for its money: jobs, data centres and a headquarters that stays put. Prime Minister Mark Carney said on October 29 that Ottawa will make an equity investment of up to C$1.6 billion in Cohere, as the company announced the initial close of a Series E round targeting up to C$7 billion at a C$35.7 billion valuation.
The round#
Germany's Schwarz Group, the owner of Lidl and Kaufland, leads the round, Cohere said. New investors are Bell Ventures, Bullhound Capital and the Government of Canada; Inovia Capital, NVIDIA and Prosperity7 Ventures are returning. Cohere called it the largest private financing round ever by a Canadian technology company.
Cohere has completed only an initial close and did not say how much has been committed so far or when it expects the round to close, CBC reported. A company spokesperson told BetaKit that Cohere has secured most of the target. CBC reported that Schwarz pledged $780 million in April to lead the round as part of Cohere's combination with German AI developer Aleph Alpha; Schwarz Digits chief executive Christian Müller said the group plans to run Cohere's models on its STACKIT cloud.
What Canada gets#
The Prime Minister's Office said the investment will be made in stages, with regular reporting on progress. In return, Cohere commits to create at least 1,000 technical jobs in Canada by 2030, put at least C$1.7 billion into additional Canadian computing infrastructure by 2030, keep its Canadian incorporation and headquarters, and keep working with the Canadian AI Safety Institute.
BetaKit reported that the money comes through the Canada Development Investment Corporation, a Crown corporation, and that AI minister Evan Solomon called the stake "staged" and milestone-based, saying "jobs and revenue targets are key" but declining to share terms.
The business#
Cohere said annual recurring revenue grew 165% year over year as of the end of the third quarter and that its customer base grew 20-fold over the past year to 300 customers. It did not disclose revenue. The company sells sovereign deployments to regulated industries and governments, built around its North agent platform, and said the money will go to models, products for regulated industries and compute.
Limits#
- The round size and valuation are targets; Cohere has not said how much has been committed beyond "most" of the target, per BetaKit.
- Revenue growth and customer figures are Cohere's own and unaudited.
- The milestones governing Canada's staged payments have not been published.
- Currency for the $780 million April pledge is as reported by CBC; Cohere's release does not restate it.
Sources#
- Prime Minister of Canada: Canada announces landmark investment in Cohere to scale secure, sovereign AI (October 29, 2026)
- Cohere via PR Newswire: Cohere Announces Series E Fundraise Targeting CAD $7 Billion (October 29, 2026)
- BetaKit: Feds to buy stake in Cohere via planned $7-billion Series E (October 29, 2026)
- CBC News: Canada to invest up to $1.6B in AI company Cohere (October 29, 2026)