Preply announced that it has raised $70 million in new financing from Horizon Capital, a venture capital firm based in Ukraine, in conjunction with Reach Capital and Hoxton Ventures. The additional funds will be utilized to facilitate the company's swift growth into AI technology, including the development of new teaching aides intended to enhance language learning. This comes in light of the current trend among tech investors who are competing to dive into AI, a trend which has seen many companies in the field acquire substantial amounts of capital at remarkable valuations.
Preply, a platform that connects learners with language tutors, has announced that it has secured $70 million in new equity and debt funding to amplify its application of AI. This capital addition follows a $50 million Series C funding round last year, bringing its total funding to over $170 million. The equity portion of the financing was led by Horizon Capital, a venture capital firm that specializes in investing in emerging businesses, particularly in Ukraine. Other investors include Reach Capital, Hoxton Ventures and more.
With the new funds, Preply will bolster its position in the online language learning space by leveraging AI-enabled human teaching. Additionally, the company is ready to launch an AI assistant designed to assist tutors in creating exercises, grammar explanations, and conversations starters. Preply has enlarged its revenues tenfold in the last three years, yet is still not profitable.
Despite the overall fundraising difficulty for startups due to the current economic climate, the AI industry continues to be a magnet for venture capitalists. This can be credited to OpenAI's ChatGPT and similar tools. Moreover, the Ukrainian tech industry is at the edge of celebration - the country, which has been fighting a war with Russia since the beginning of 2020, has seen the emergence of several billion-dollar "unicorns" with Ukrainian founders like Max Lytvyn and Alex Shevchenko of Grammarly, and Dmitriy Zaporozhets of GitLab. Global tech giants Google, Samsung and Amazon have also set up multiple R&D centers in Ukraine.
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