Canada takes a stake in AI company Cohere with an investment of up to C$1.6 billion

The government’s investment and its conditions

Canadian Prime Minister Mark Carney announced in Montréal on Oct. 29 that the government will make an equity investment of up to C$1.6 billion in Toronto-based AI company Cohere. The Prime Minister’s Office describes it as a commercial investment made alongside private investors Nvidia, Bell and Schwarz Group. The money will not be paid at once but in stages, with regular reporting on progress. The amount is about US$1.1 billion according to Semafor and about US$1.14 billion according to Tech Times. The size of the government’s stake was not disclosed.

In return, Cohere committed to create at least 1,000 new technical jobs in Canada by 2030 and to invest at least C$1.7 billion (about US$1.21 billion, according to Tech Times) in additional computing infrastructure in the country. It will also keep its incorporation and headquarters in Canada. According to the release, Cohere will invest in research partnerships in Canada, create opportunities for students and recent graduates and keep working with the Canadian AI Safety Institute.

According to Tech Times, the investment is made through CDEV, a Crown corporation that manages government assets at arm’s length from ministers; the government’s release does not mention this. The same report says funds will be disbursed in tranches contingent on Cohere meeting measurable commitments. Tech Times reads the structure as an ongoing veto over the company’s direction; the release defines no such power.

Carney called the deal “an investment in choice, in security, and in our ability to live our lives as we choose.” Evan Solomon, minister of artificial intelligence and digital innovation, said founders should not have to leave Canada to build a company that succeeds around the world.

The Series E round

The government’s investment is part of a Series E round for which Cohere announced an initial close the same day. The round targets up to C$7 billion. According to Cohere’s release, a round of that size would represent a C$35.7 billion valuation. The amount raised in the initial close was not disclosed. The companies of Schwarz Group lead the round. New investors include Bell Ventures, Bullhound Capital and the Government of Canada, and returning investors Inovia Capital, Nvidia and Prosperity7 Ventures are also taking part. CEO Aidan Gomez called it the largest private capital raise in Canadian history, and the release describes it as the largest private financing round ever undertaken by a Canadian technology company.

Christian Müller, CEO of Schwarz Digits, said the goal is to anchor these frontier capabilities in the group’s sovereign STACKIT cloud infrastructure. According to Tech Times, Schwarz Group’s €500 million structured financing commitment was first announced in April 2026, together with the combination with Aleph Alpha.

The company and its plans

Cohere says its annual recurring revenue (ARR) grew 165% year over year as of the end of the third quarter of 2026 and that it has grown its global customer base twentyfold to 300; these figures are the company’s own. Founded in 2019, the company has offices in San Francisco, London, New York, Berlin, Montréal, Ottawa, Singapore, Paris, Tokyo, the United Arab Emirates and Seoul in addition to its Toronto headquarters. According to the release, the new money will go toward its modeling and product roadmap, vertical AI solutions for regulated industries and long-term computing infrastructure.

According to a post published the same day by co-founders Nick Frosst, Ivan Zhang and Aidan Gomez, the company aims to be a frontier model builder outside the U.S. and China. The post lists plans to complete the Aleph Alpha combination and the AISLE acquisition, launch Cohere Cyber for air-gapped environments, release new models and begin frontier-scale training with allied partners. According to Tech Times, Cohere previously received a C$240 million compute commitment under Canada’s Sovereign AI Compute Strategy for a domestic AI data center.