Key Takeaways:
- Magic secures $320M funding, led by Eric Schmidt.
- LTM-2-mini model handles 100M token context window, setting new standards.
- Google Cloud and Nvidia partner to build Magic’s AI supercomputers.
- Magic’s valuation targets $1.5B, up from $500M in February 2024.
- Coding AI market expected to hit $27.17B by 2032.
Magic, a leading startup in generative AI for coding, has raised $320 million in a new funding round, with significant contributions from Eric Schmidt, Atlassian, CapitalG (Alphabet’s growth fund), and Sequoia Capital.
This brings Magic’s total funding to nearly $465 million, positioning the company among the top-tier AI startups. Established in 2022 by Eric Steinberger and Sebastian De Ro, Magic focuses on revolutionizing software development through AI.
In July, Reuters noted that Magic aimed to raise more than $200 million at a $1.5 billion valuation. The funding round exceeded expectations, though the startup’s current valuation remains undisclosed; Magic had a valuation of $500 million in February.
Their flagship technology, the Long-term Memory Network (LTM), is designed to handle large context windows, enabling more accurate and efficient code generation. The latest model, LTM-2-mini, manages a context window of 100 million tokens, significantly surpassing industry standards.
In a strategic move, Magic has partnered with Google Cloud to build two AI supercomputers, Magic-G4 and Magic-G5, utilizing Nvidia’s H100 GPUs and next-gen Blackwell chips.
This partnership aims to scale these supercomputers to tens of thousands of GPUs to achieve 160 exaflops of computing power.
It’s wild how much money is pouring into AI.
— BraceForNow (@BraceForNow) August 29, 2024
This infrastructure boost is expected to greatly enhance Magic’s AI capabilities, bringing the company closer to its long-term goal of contributing to Artificial General Intelligence (AGI).
The coding AI market is projected to reach $27.17 billion by 2032, and Magic is positioning itself as a key player in this space. With advanced context handling and strategic partnerships, the company is well-placed to compete with established platforms like GitHub Copilot.
LTM-2-Mini has 1000X tokens more than I got hairs on my head!
This @magicailabs’s team is cooking up an AI with more capacity than all the parking garages in Manhattan! It’s like they’ve given it a memory the size of Long Island!— Khaled Ameen (@KhaledsRRR) August 29, 2024
Magic’s co-founder, Eric Steinberger, expressed optimism about the future, highlighting the importance of their partnership with Google and Nvidia in accelerating their mission to develop artificial intelligence tools that assist developers and advance towards AGI.
The involvement of high-profile investors like ex-Google CEO Eric Schmidt reflects strong confidence in Magic’s potential to transform software development through AI.
As Magic continues to innovate and expand, it is poised to play a significant role in the future of the generative AI coding landscape.
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