Question-and-answer site operator Quora Inc. has raised a fresh $75 million — the first round of capital it's raised in five years.
Adam D'Angelo, CEO of the Mountain View-based company, on Wednesday announced that Quora nabbed the new funding solely from famed venture firm Andreessen Horowitz. The new funds will be used to accelerate the capabilities and development of Poe, Quora's artificial-intelligence-powered chat system.
Poe works in two ways. First, users can ask the chatbot questions which generates answers from a range of other AI platforms like ChatGPT. Second, Quora is allowing users to develop their own unique AI bots through Poe’s system, which they can then monetize.
It's the company’s unique take on the content creator economy, setting Quora apart from a competitive AI chatbot market.
"We expect the majority of the funding to be used to pay creators of bots on the platform through our recently-launched creator monetization program," D’Angelo said in a blog post.
Since launching Poe last February and its content creation platform last October, the company said it has "millions of users." According to an analysis by TechCrunch, Poe’s mobile app was installed more than 18.4 million times as it grew to have 1.22 million followers by October.
"Already, Poe shows signs of increasing returns to scale,” Andreessen Horwitz partner David George wrote in a blog post. "Currently, Poe is one of the top 5 largest generative AI-related properties, and creators have built 1M+ bots on Poe the platform."
Though D'Angelo said the funding is a sign from investors that the company can continue growing, it wasn’t valued as highly as it once was. This funding round valued the company at $500 million, the CEO said — a steep decline from the previous valuation of $2 billion that PitchBook Data gave to Quora in 2019.
"In the last two years, the market has changed substantially, driven by rising interest rates and higher cost of capital," D’Angelo wrote. "This means our valuation is lower than our previous peak, but we are happy to finally be marked to this new market."
Early on in 2020 the company cut an undisclosed number of staffers to reorganize and "operate independently." At the time, the company said it was on the trajectory to be cash flow positive, but the move to cut staff was so that it didn't have rely on outside capital. Today, according to D'Angelo, the company is cash flow positive and has 400 million monthly visitors to its site.
The current funding round brings the company’s total raised capital to over $373.8 million with past backers such as Benchmark, Peter Thiel and Y Combinator, according to PitchBook.
