The potential of generative AI coding technologies has attracted significant investor interest, with enterprises spending large sums on hiring software developers. Magic AI is one of several startups in this space, with others including Augment Inc., Cognition AI Inc., and Poolside AI. The success of GitHub’s Copilot, an AI coding service with over 1.3 million paid subscribers, has validated the market for AI code assistants. However, the development of such tools requires large datasets for training and significant computing resources.
Key takeaways:
- Magic AI, a generative AI coding assistant startup, is reportedly seeking to raise over $200 million in a new funding round, which would triple its valuation to $1.5 billion.
- The company's tool, which is still under development, is said to allow software engineers to describe in natural language the kind of application or function they want to create, and the AI will write all the necessary code.
- Despite the success of AI coding tools like GitHub's Copilot and OpenAI's ChatGPT, creating a generative AI coding assistant comes with significant costs, including the need for large datasets for training and substantial, energy-intensive computing resources.
- Magic AI plans to use the funding from its next round to improve its coding assistant models, which are said to be capable of supporting long-context windows, allowing them to process more data in one query.