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AI Coding Software Magic Looking To Conjure Up $200M At $1.5B — Report

Illustration of robot drawing in the air. (Generative AI)

AI Coding Software Magic Looking To Conjure Up $200M At $1.5B — Report

San Francisco-based Magic, which develops AI models to write software, is reportedly in talks with investors to raise a fresh $200 million.

The raise would come at a $1.5 billion valuation — triple its previous valuation from just five months ago — per a Reuters report. Magic has no revenue and no product for sale, the report says.

The startup last raised a $117 million round in February led by NFDG Ventures, which also included participation from CapitalG and Elad Gil.

Investors in the new round would include Jane Street Capital, according to the report.

Hot sector

While everything in AI is hot, software development seems to be something investors have specifically keyed in on when exploring the best near-term uses for the tech.

Not only does AI hold the promise to speed up application and software development, but also could cut down the cost of software developers — as well as the problem of just finding them to hire in the first place. It could also possibly make them more productive.

Other startups that have raised cash in the space include London-based, which raised a $250 million-plus Series D led by Qatar Investment Authority last year.

Earlier this year, Palo Alto, California-based Augment locked up a $227 million Series B round at a $977 million post-money valuation. Augment helps developers and software teams by giving them AI coding assistance.

That same week, San Francisco-based Cognition reportedly locked up a $175 million investment led by Founders Fund at a $2 billion valuation. The 6-month-old startup has developed an artificial intelligence-powered coding assistant called Devin.

Founded in 2022, Magic has raised $145 million, per Crunchbase.

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Illustration: Dom Guzman

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