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Exclusive: AI inference startup Modal Labs in talks to raise at .5B valuation, sources say

Exclusive: AI inference startup Modal Labs in talks to raise at $2.5B valuation, sources say

Modal Labs, a startup specializing in AI inference infrastructure, is talking to VCs about a new round at a valuation of about $2.5 billion, according to four people with knowledge of the deal. Should the deal close at these terms, the funding round would more than double the company’s valuation of $1.1 billion announced less than five months ago, when it announced an $87 million Series B round.

General Catalyst is in talks to lead the round, the people told TechCrunch. Modal’s annualized revenue run rate (ARR) is approximately $50 million, our sources said. The discussions are early, and terms could still change.  

Modal Labs co-founder and CEO Erik Bernhardsson denied that his company was actively fundraising and characterized his recent interactions with VCs as general conversations. General Catalyst did not respond to our requests for comment.

Modal is focused on optimizing inference, the process of running trained AI models to generate answers from user requests. Improving inference efficiency reduces compute costs and cuts down the lag time between a user’s prompt and the AI’s response.

Modal is one of the handful of inference-focused companies attracting intense investor attention now. Last week, its competitor Baseten announced a $300 million raise at a $5 billion valuation, more than doubling the $2.1 billion valuation it reached just months prior in September. Similarly, Fireworks AI, an inference cloud provider, secured $250 million at a $4 billion valuation in October.

In January, the creators of the open source inference project vLLM announced they had transitioned the tool into a VC-backed startup, Inferact, raising $150 million in seed funding led by Andreessen Horowitz at an $800 million valuation. Meanwhile, TechCrunch reported that the team behind SGLang has commercialized as RadixArk, which sources told us secured seed funding at a $400 million valuation led by Accel.

Modal was co-founded by CEO Erik Bernhardsson in 2021 after he spent more than 15 years building and leading data teams at companies including Spotify and Better.com, where he was CTO.

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The startup counts Lux Capital and Redpoint Ventures among its earlier backers.

Editor’s Note: This story was updated to include a comment from Modal.

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X is overhauling how it pays creators, phasing out its long-running Revenue Sharing program in favor of a new system called the Original Content Rewards Program.

The platform’s Creators account announced the change in a post, saying the program is meant to “reward creators who bring original ideas, expertise, reporting, creativity, and commentary to X.”

According to the announcement, X stopped accepting new Revenue Sharing enrollments immediately and will wind the program down entirely after Sept. 7. Creators currently enrolled will receive three final payouts — two on the standard schedule in mid- and late August, and a final payment around Sept. 11 covering earnings through the cutoff date. Starting Sept. 8, existing Revenue Sharing members can apply for the new program if they meet its eligibility requirements, the company said.

Per X’s announcement, the new program ties earnings to “qualified impressions” a creator’s original content receives, rather than the advertising-revenue split that defined the old system. Qualified impressions must come from unique, verified Premium subscribers viewing at least half of a post on the Home Timeline; impressions that are duplicated, paid, promoted, or fraudulent don’t count.

To qualify, X says creators must be at least 18, live in an eligible country, hold a Personal or Business account in good standing, subscribe to a paid X tier, and have at least 500 verified followers, along with 500,000 Home Timeline impressions from verified users over the prior 90 days. Those requirements must be maintained continuously to keep receiving payouts, according to the announcement.

X’s guidelines lean heavily on defining what counts as “original.” Per the company’s post, content that is copied, reuploaded without authorship, generated through automated means, or reposted with only minor edits — such as captions, watermarks, or basic text overlays — won’t qualify. Users can earn from reposting others’ material only if they add substantive commentary, analysis, or creative editing. So, simply describing what’s already happening in a post doesn’t meet the bar.

As noted in Engadget’s report on the news, X adjusted its Revenue Sharing formula in March to weight engagement more heavily toward a creator’s home region. That shift, they wrote, likely followed revelations that a number of popular accounts posting pro-Trump content and US-focused commentary were not actually based in the United States.

Whether the new Original Content Rewards Program carries over a similar regional weighting is not yet clear.

#retires #revenue #sharing #Original #Content #Rewards #program">X retires revenue sharing for new ‘Original Content Rewards’ program
                                                            X is overhauling how it pays creators, phasing out its long-running Revenue Sharing program in favor of a new system called the Original Content Rewards Program. The platform’s Creators account announced the change in a post, saying the program is meant to “reward creators who bring original ideas, expertise, reporting, creativity, and commentary to X.”According to the announcement, X stopped accepting new Revenue Sharing enrollments immediately and will wind the program down entirely after Sept. 7. Creators currently enrolled will receive three final payouts — two on the standard schedule in mid- and late August, and a final payment around Sept. 11 covering earnings through the cutoff date. Starting Sept. 8, existing Revenue Sharing members can apply for the new program if they meet its eligibility requirements, the company said.

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Per X’s announcement, the new program ties earnings to “qualified impressions” a creator’s original content receives, rather than the advertising-revenue split that defined the old system. Qualified impressions must come from unique, verified Premium subscribers viewing at least half of a post on the Home Timeline; impressions that are duplicated, paid, promoted, or fraudulent don’t count.
        
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To qualify, X says creators must be at least 18, live in an eligible country, hold a Personal or Business account in good standing, subscribe to a paid X tier, and have at least 500 verified followers, along with 500,000 Home Timeline impressions from verified users over the prior 90 days. Those requirements must be maintained continuously to keep receiving payouts, according to the announcement.X’s guidelines lean heavily on defining what counts as “original.” Per the company’s post, content that is copied, reuploaded without authorship, generated through automated means, or reposted with only minor edits — such as captions, watermarks, or basic text overlays — won’t qualify. Users can earn from reposting others’ material only if they add substantive commentary, analysis, or creative editing. So, simply describing what’s already happening in a post doesn’t meet the bar.
As noted in Engadget’s report on the news, X adjusted its Revenue Sharing formula in March to weight engagement more heavily toward a creator’s home region. That shift, they wrote, likely followed revelations that a number of popular accounts posting pro-Trump content and US-focused commentary were not actually based in the United States. Whether the new Original Content Rewards Program carries over a similar regional weighting is not yet clear.

                    
                                            
                            
                        
                                    #retires #revenue #sharing #Original #Content #Rewards #program

announced the change in a post, saying the program is meant to “reward creators who bring original ideas, expertise, reporting, creativity, and commentary to X.”

According to the announcement, X stopped accepting new Revenue Sharing enrollments immediately and will wind the program down entirely after Sept. 7. Creators currently enrolled will receive three final payouts — two on the standard schedule in mid- and late August, and a final payment around Sept. 11 covering earnings through the cutoff date. Starting Sept. 8, existing Revenue Sharing members can apply for the new program if they meet its eligibility requirements, the company said.

Per X’s announcement, the new program ties earnings to “qualified impressions” a creator’s original content receives, rather than the advertising-revenue split that defined the old system. Qualified impressions must come from unique, verified Premium subscribers viewing at least half of a post on the Home Timeline; impressions that are duplicated, paid, promoted, or fraudulent don’t count.

To qualify, X says creators must be at least 18, live in an eligible country, hold a Personal or Business account in good standing, subscribe to a paid X tier, and have at least 500 verified followers, along with 500,000 Home Timeline impressions from verified users over the prior 90 days. Those requirements must be maintained continuously to keep receiving payouts, according to the announcement.

X’s guidelines lean heavily on defining what counts as “original.” Per the company’s post, content that is copied, reuploaded without authorship, generated through automated means, or reposted with only minor edits — such as captions, watermarks, or basic text overlays — won’t qualify. Users can earn from reposting others’ material only if they add substantive commentary, analysis, or creative editing. So, simply describing what’s already happening in a post doesn’t meet the bar.

As noted in Engadget’s report on the news, X adjusted its Revenue Sharing formula in March to weight engagement more heavily toward a creator’s home region. That shift, they wrote, likely followed revelations that a number of popular accounts posting pro-Trump content and US-focused commentary were not actually based in the United States.

Whether the new Original Content Rewards Program carries over a similar regional weighting is not yet clear.

#retires #revenue #sharing #Original #Content #Rewards #program">X retires revenue sharing for new ‘Original Content Rewards’ program

X is overhauling how it pays creators, phasing out its long-running Revenue Sharing program in favor of a new system called the Original Content Rewards Program.

The platform’s Creators account announced the change in a post, saying the program is meant to “reward creators who bring original ideas, expertise, reporting, creativity, and commentary to X.”

According to the announcement, X stopped accepting new Revenue Sharing enrollments immediately and will wind the program down entirely after Sept. 7. Creators currently enrolled will receive three final payouts — two on the standard schedule in mid- and late August, and a final payment around Sept. 11 covering earnings through the cutoff date. Starting Sept. 8, existing Revenue Sharing members can apply for the new program if they meet its eligibility requirements, the company said.

Per X’s announcement, the new program ties earnings to “qualified impressions” a creator’s original content receives, rather than the advertising-revenue split that defined the old system. Qualified impressions must come from unique, verified Premium subscribers viewing at least half of a post on the Home Timeline; impressions that are duplicated, paid, promoted, or fraudulent don’t count.

To qualify, X says creators must be at least 18, live in an eligible country, hold a Personal or Business account in good standing, subscribe to a paid X tier, and have at least 500 verified followers, along with 500,000 Home Timeline impressions from verified users over the prior 90 days. Those requirements must be maintained continuously to keep receiving payouts, according to the announcement.

X’s guidelines lean heavily on defining what counts as “original.” Per the company’s post, content that is copied, reuploaded without authorship, generated through automated means, or reposted with only minor edits — such as captions, watermarks, or basic text overlays — won’t qualify. Users can earn from reposting others’ material only if they add substantive commentary, analysis, or creative editing. So, simply describing what’s already happening in a post doesn’t meet the bar.

As noted in Engadget’s report on the news, X adjusted its Revenue Sharing formula in March to weight engagement more heavily toward a creator’s home region. That shift, they wrote, likely followed revelations that a number of popular accounts posting pro-Trump content and US-focused commentary were not actually based in the United States.

Whether the new Original Content Rewards Program carries over a similar regional weighting is not yet clear.

#retires #revenue #sharing #Original #Content #Rewards #program

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