Modal raises $750 million Series D at $15.75 billion valuation

Modal closed a $750 million Series D led by Excel at a $15.75 billion valuation, with its run rate surpassing $1 billion. The company experienced rapid growth, increasing from under $100 million in mid-to-late last year to over $1 billion. Modal is part of a broader inference market where the top four or five providers have a combined run rate of $5-6 billion, which is less than 5% of the combined revenue of OpenAI and Anthropic (over $100 billion). Margins for inference providers have improved to the mid-30s, with expectations to reach 50%.

The market is seen as having significant upside due to the cost advantages of open-weight models and the need for efficient inference, with Modal positioned as a key player alongside Base, Tan, and Fireworks. The inference market is exploding, and Modal's rapid growth and improving margins justify its high valuation, representing a significant opportunity in the AI infrastructure layer. Modal closes at a $15.75 billion valuation with a run rate surpassing a billion dollars, according to the company.