CapitalG, the innovation fund linked to Google owner Alphabet, has invested in a $23 million series A round raised by Magic.dev, an Austrian/British-founded natural language AI assistant project for software engineers.
The round brings San Francisco-HQed Magic.dev's funding haul to $28 million since inception in 2022.
Natural language processing has spawned AI assistants everywhere from healthcare to banking and customer service. Today's natural language models are intelligent enough to decipher human speech patterns and produce artificial conversational responses. Generative AI has set the stage for conversational automation to enter highly complicated fields of operation. Less than a week ago, Tech.eu tracked an example in the healthcare space, with Re:course AI's training school avatars.
A European-founded startup, Magic.dev, believes natural language processing is ready to scale up into computer programming environments. Magic.dev is registered as a public benefit corporation and has even grander ambitions in the long term — eventually it wants to launch a "superhuman" general AI, accomplishing the long sought third phase of automation, where algorithms can form an understanding of essentially any intellectual task.
With OpenAI churning hype out of its bet on generative language model ChatGPT, natural language processing does seem like the best place to start on Magic.dev's aspirations.
The startup is working on a computer programming AI assistant that would be trained to understand computer programming queries from vast language datasets, but would also be able to discern the context of the user's specific software application.
According to Steinberger, the adoption of AI assistants at work will radically improve workforce productivity and accelerate the impact of scientific research.
Steinberger is a serial entrepreneur and a computer science graduate of University of Cambridge. He previously founded ClimateScience.org, a schools content provider focused on teaching children about climate change.
"Our mission is to deploy AI to accelerate science and make the world more productive. For decades, technology was just a tool; soon it will be a colleague. The adoption of ‘AI assistants’ in the workplace will be as impactful as the industrial revolution, and it’s important to get this transition right," Steinberger said.
"I’m excited to be applying our technology to the field of software engineering; it’s highly complex, collaborative, and a bottleneck for many organizations."
CapitalG's partner Jill Chase has been on the growth fund's enterprise AI beat for the past three years.
With Chase now joining Magic.dev's board, the deal gives CapitalG a strategic view on emerging natural language opportunities, at a time when Alphabet's leadership is on guard against any OpenAI-driven challenge.
Taking natural language into specific segments offers advantages. Software engineering, in particular, is pretty lucrative with US figures showing talent shortfalls will escalate in coming years. Estimates from the US-based International Data Corp predict developer shortages will rise from 1.4 million in 2021 to 4 million in 2025.
"Code generation is an obvious application for AI, given the magnitude of the software development market and the clear ROI associated with productivity gains," Chase said. "It’s a space where the best technology will win because the open ecosystem allows for easy distribution of the best product. Magic is highly differentiated from other code generation start-ups because it’s on a path to go far beyond simple code completion; it’s building a true AI colleague. This has the potential to fundamentally change software development.”
"Due to what remains a tight technical talent market, many organisations are unable to hire the engineers they need. Magic will enable people and organizations to build game-changing technology faster and more easily than has ever been possible before.”