AI Coding Startup Magic Raises $200M at $1.5B Valuation

San Francisco-based Magic, which develops AI models to write software, is reportedly in talks with investors to raise a fresh $200 million.

• The raise would come at a $1.5 billion valuation – triple its previous valuation from just five months ago.
• Magic has no revenue and no product for sale, the report says.

Magic's Funding History

The startup last raised a $117 million round in February led by NFDG Ventures, which also included participation from CapitalG and Elad Gil.

• Investors in the new round would include Jane Street Capital, according to the report.

AI in Software Development

While everything in AI is hot, software development seems to be something investors have specifically keyed in on when exploring the best near-term uses for the tech.

• AI holds the promise to speed up application and software development.
• It could cut down the cost of software developers.
• It could possibly make software developers more productive.

Other AI Startups in the Space

Other startups that have raised cash in the space include:

• London-based Builder.ai, which raised a $250 million-plus Series D led by Qatar Investment Authority last year.
• Palo Alto, California-based Augment, which locked up a $227 million Series B round at a $977 million post-money valuation.
• San Francisco-based Cognition, which reportedly locked up a $175 million investment led by Founders Fund at a $2 billion valuation.

Magic's Funding and Crunchbase Data

Founded in 2022, Magic has raised $145 million, per Crunchbase.

Conclusion

Magic's recent funding round highlights the significant interest in AI-powered software development. With its focus on using ai to automate coding, Magic is positioned to disrupt the software development industry. The company's rapid growth and high valuation indicate the potential of this approach, as investors are betting on the future of ai in coding and its ability to transform the way software is built. The success of Magic and other startups in this space could significantly impact the future of software development and make it more accessible, efficient, and cost-effective.