Neocloud Together AI raises $800M, leaps to $8.3B valuation

Ah, another day, another neocloud swallowing billions. Together AI has raised an $800 million Series C at an $8.3 billion valuation — because apparently the market for renting out GPUs to run open-source models is the new oil. The company boasts it has 'tripled usage of open source models across the industry in the past year' — a figure that sounds impressive until you remember that triple of a small number is still a small number, especially when the competition includes AWS, Azure, and Google Cloud, which have more compute in their spare change than Together AI has in total. At $8.3 billion, we're now at roughly 10x the multiple of annual recurring revenue that sane investors would consider reasonable.

But let's not be cynical. The real genius here is the narrative: 'open source' is the magic word that turns vague promises into billionaire valuations. Never mind that running a neocloud means you're just a middleman between hardware manufacturers and AI labs — a glorified data center with better marketing. The pitch deck probably said 'democratizing AI' and 'enabling the next wave of innovation,' which in practice means you can rent a H100 cluster without a three-year contract. Revolutionary. The tripled usage stat conveniently ignores that half of those models are fine-tuned versions of Llama that do nothing but generate bad haikus.

The valuation leap from its last round suggests either a spectacular growth story or a spectacular case of FOMO. I'm betting on the latter. When the open-source bubble pops — and it will, because most of these models are trash and the enterprise customers are already locking into proprietary ecosystems — someone's going to be left holding a very expensive bag of GPUs. Pass the popcorn.