Modal Labs in talks to raise at $15B, tripling its valuation in four months: Report

Modal Labs is said to be in talks to raise fresh money at a $15 billion valuation, according to Bloomberg. If that deal lands, it would mark a sharp jump from the $4.65 billion valuation the company hit in May, after a $355 million round. Four months is a short run for a value to nearly triple, even in AI.

The company is not just riding the general AI wave. Modal sells infrastructure for developers, and a big part of its pitch is speed: customers can get access to GPUs in less than a second because the team built its own file system, container runtime and scheduler instead of leaning on AWS or Azure. It also charges by the second for both GPU and CPU time. That kind of billable precision matters when AI products are built on huge volumes of inference work.

Inference is where a trained model answers prompts, and investors are treating it as the hotter part of the stack now that training has already had its turn. Analysts cited in the report say inference now makes up about two-thirds of AI computing demand, up from one-third in 2023. A forecast pegs the market at $103.7 billion this year and $312.6 billion by 2034. That explains why capital is still flowing toward the infrastructure layer.

Modal was founded in January 2021 by Erik Bernhardsson and Akshat Bubna. Bernhardsson spent 15 years on recommendation systems at Spotify and later ran engineering at Better.com; Bubna came from Scale AI and had been CTO at Better.com. The company is based in New York, with engineering teams in San Francisco and Stockholm, and had more than 120 employees when it last raised money. Its most visible product right now is Sandboxes, which lets AI coding agents write, run and test code in isolated environments before anything goes live.

The last round was led by General Catalyst and Redpoint Ventures, with Accel, Menlo Ventures and Bain Capital Ventures also participating. Since 2021, Modal has raised about $465 million in total. Revenue has been moving fast too: annualized revenue reached $300 million by April, up from about $119 million at the end of 2025, with most of that growth coming from AI coding tools that need compute to actually run.