Grammarly secures $1 billion from General Catalyst to build AI productivity platform
Grammarly
has raised $1 billion in non-dilutive financing from General Catalyst to expand its artificial intelligence (AI) offerings, aiming to grow into a comprehensive productivity platform, the companies said on Thursday.
Grammarly, known for its popular writing assistant tool, plans to use the capital to fund sales and marketing costs and strategic acquisitions. It looks to use AI to build more communication-based productivity tools and even hosts third-party tools on its platform by leveraging access to its 40 million daily users.
The investment, one of the biggest out of General Catalyst's Customer Value Fund (CVF), could help late-stage tech companies like Grammarly accelerate growth by using dedicated capital to acquire new customers. By reallocating funds typically tied up in sales and marketing, Grammarly can invest more in product development.
In return, General Catalyst doesn't receive an equity stake in Grammarly, but will get a capped return linked to revenue generated through using this capital. This is structured as a percentage of the revenue generated from the fund being used in customer acquisition.
Founded in 2009, Grammarly has an annual revenue exceeding $700 million and is profitable. In December, Grammarly appointed Shishir Mehrotra, previously CEO of the acquired productivity platform Coda, as its new leader, signaling a push into broader AI-powered workplace tools.
Live Events
"As Grammarly is going through a huge transformation of going from being a what is mostly known as a single-purpose agent to being an agent platform, it just felt very important for us to be able to bet big in our product development and in M&A as well as in our growth strategies," Mehrotra said in an interview.
Discover the stories of your interest
Blockchain
5 Stories
Cyber-safety
7 Stories
Fintech
9 Stories
E-comm
9 Stories
ML
8 Stories
Edtech
6 Stories
He added said the company has an eventual goal to go public, although no imminent plans.
"I'm right now just focused on making sure we're innovating with new products, growing as fast as we can. But when we feel ready, we'll go public," Mehrotra added.
The dedicated growth investment, if it pays off, could also benefit the valuation of Grammarly and General Catalyst's stake in the company, as it has also been an equity investor in Grammarly's series B funding in 2017.
San Francisco-based Grammarly has raised over $550 million in venture capital, according to PitchBook. It was last valued at $13 billion in 2021.
General Catalyst's Customer Value Fund operates apart from the firm's main venture funds with separate limited partners, and is not included in the newly raised $8 billion fundraising the firm announced.
This approach is part of a strategic evolution for the tech investor, led by CEO Hemant Taneja, as it seeks to grow beyond the traditional venture capital model, including creating innovative funding mechanisms.
Its customer acquisition fund has invested in nearly 50 companies, including Lemonade and Fivetran, as it leads on growth metrics to a more predictable path to returns.
"Companies like Grammarly basically have a machine where they can invest dollars in sales and marketing and generate a very consistent return," said Pranav Singhvi, Managing Director at General Catalyst, "With this wave of AI, giving Grammarly the firepower to actually go and invest could land those customers beyond the 40 million."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
19 minutes ago
- Economic Times
Passenger vehicle sales remain flat in May amid sluggish demand
Agencies Representational Image Sales of cars, sedans and utility vehicles remained largely flat last month, albeit on a high base, amid sluggish consumer demand in the local market. As per initial industry estimates about 352,000 passenger vehicles were sold last month, which is an increase of about 0.1% over the same period last fiscal. Automakers in India mostly report wholesale dispatches from factories to dealerships and not retail sales to customers. Retail sales are estimated to have dropped by 0.8% in this period, industry insiders said. A senior industry executive who did not wish to be identified said, 'There is pressure in the market. But we also have to remember that the base is now very high. India is one of the very high markets in the world which is selling more than 4 million passenger vehicles annually. So even if the growth is modest, and is likely to remain so for some time, volumes are still good.' Demand in the local market continued to be driven by SUVs last month, with companies like Mahindra & Mahindra (M&M) and Toyota Kirloskar Motor (TKM) clocking robust sales numbers. Market leaders Maruti Suzuki and Hyundai did not release sales numbers for May Sunday. Homegrown auto major Mahindra, in fact, continued to maintain its lead over rival Tata Motors in May, powered by demand for its range of utility vehicles. Mahindra sold 52,431 units last month, which is an increase of 21% over 43,218 units sold in May 2024. At Tata Motors, sales fell by 11% to 41,557 units in the same period. Nalinikanth Gollagunta, CEO, Automotive Division, M&M, said, 'Thanks to continued demand for our products, we were able to deliver industry-leading growth across our ICE and BEV portfolio.' Toyota Kirloskar Motor (TKM) reported an increase of 22% to sell 29,280 units last month. Varinder Wadhwa, Vice President, Sales-Service-Used Car Business, said, in line with overall market trends, the company's MPV and SUV segments continued to be the primary growth drivers—reflecting a clear shift in customer preference towards versatile mobility options.'With the onset of the monsoon and forecasts indicating a normal to above-normal season, we remain optimistic about improved market sentiment in the coming months, particularly across rural and semi-urban regions. This, backed by our vast product portfolio and innovative campaigns, we are well-positioned to maintain this growth trajectory', Wadhwa informed. Kia India and JSW MG Motor saw sales grow by 14% (to 22315 units) and 40% (to 6304 units), respectively. In the two-wheeler segment, demand remained healthy with Chennai-based TVS Motor Company reporting sales increase of 14% at 309,287 units in May. Sales of commercial vehicles was subdued. Market leader Tata Motors saw sales fall 9% to 25,872 units in the month under review. In the farm equipment sector, Mahindra sold 38,914 tractors last month, which is an increase of 10% over Veejay Nakra, President – Farm Equipment Business, Mahindra & Mahindra, said, 'Early advancement of above normal Southwest monsoon should bode well for kharif sowing. Land preparation activities are progressing well for paddy sowing. Approval of hike in MSP for Paddy and other kharif crops will bring positive sentiments among farmers. Better reservoir levels , Government announcement of record foodgrain production and introduction of various schemes will help farmers aim higher productivity going forward and in turn augur well for tractor demand.' COMPANY MAY 2024 MAY 2025 % CHANGE Mahindra & Mahindra 43218 52431 21 Tata Motors 46697 41557 -11 Toyota Kirloskar Motor 23928 29280 22.4 Kia India 19500 22315 14.4 JSW MG Motor India 4510 6304 40
Hindustan Times
3 hours ago
- Hindustan Times
Prestige Group to launch housing projects worth ₹42,000 cr in FY'26 to tap strong consumer demand
New Delhi, Jun 1 (PTI) Realty firm Prestige Estates Projects Ltd will launch multiple housing projects across major cities this fiscal year with an estimated revenue of more than ₹42,000 crore, as it looks to expand business to capitalize on strong consumer demand. According to its latest investors presentation, Bengaluru-based Prestige Estates plans to launch as many as 25 residential projects having 44.80 million sq ft of developable area, with an estimated gross development value of ₹42,120 crore, in this financial year. These projects are lined up in Bengaluru, Chennai, Hyderabad, Mumbai, Delhi-NCR and Goa. During the 2024-25 financial year, the company launched a lesser number of projects due to delays in regulatory approvals. Prestige Estates launched 26.28 million square feet during the last fiscal year, with a combined gross development value of ₹26,222.8 crore. Last year, the company's sales bookings or pre-sales were affected. Prestige Estates sales bookings during the 2024-25 fiscal declined 19 per cent to ₹17,023.1 crore, "reflecting the impact of deferred launches amid approval delays", the company had said in April. The company was not able to achieve the targeted sales bookings of ₹24,000 crore last fiscal. Sales volume for 2024-25 stood at 12.58 million square feet, down 38 per cent Y-o-Y (year-on-year). Total units sold stood at 5,919 last fiscal. The average realisation for apartments, villas, and commercial products rose to ₹14,113 per square feet, an impressive 36 per cent increase Y-o-Y. Plot sale realisation increased to ₹7,167 per square foot, registering a 50 per cent Y-o-Y growth. On the financial performance front, during 2024-25 fiscal, Prestige Estates net profit fell sharply to ₹467.5 crore, from ₹1,374.1 crore in the preceding year. Total income too declined to ₹7,735.5 crore in the last fiscal year, from ₹9,425.3 crore in the 2023-24 fiscal. Prestige Group has developed more than 300 projects so far and is constructing a large number of properties across major states.
Mint
3 hours ago
- Mint
Air India to recalibrate plans on Turkish Technics maintenance works for its wide-body planes
New Delhi, Jun 1 (PTI) Air India will look to send its wide-body planes, whose heavy maintenance is being done by Turkish Technic, to other MRO entities, as part of recalibrating its plans taking into cognisance the recent developments related to Turkiye, according to the airline's CEO Campbell Wilson. Against the backdrop of Turkiye backing Pakistan and condemning India's strikes on terror camps in the neighbouring country in May, aviation security watchdog BCAS, on May 15, revoked the security clearance for Turkish company Celebi Airport Services India Pvt Ltd in the "interest of national security". On May 30, aviation safety regulator DGCA granted a one-time final extension of three months to IndiGo on damp leasing of two Boeing 777 aircraft from Turkish Airlines till August 31 but directed the airline to terminate the lease within the three-month period. When asked about some of Air India's wide-body aircraft being sent to Turkish Technic for maintenance works, the Air India CEO and MD said it is a global business and a global supply chain. "It does take a while to adjust when the circumstances change around us but we are obviously sensitive to the national sentiment and perhaps the national wishes. So, regardless of which country we are talking about, we would clearly take cognisance of what people like us to do and expect us to do," he told PTI in an interview. Heavy maintenance works of some of the airline's wide-body B777s and B787s are done by Turkiye-based Turkish Technic. In the short-term, Wilson said the airline needs to send some aircraft for MRO works overseas to places in the Middle East, South East Asia, the US and in a couple of cases, business to Turkish Technic as it will take some time for India to have the capacity to do such works. "With this most recent development, we will look to recalibrate where we sent our aircraft, reduce the amount that we are sending to Turkiye and send it to other places. "But that does take some time because aircraft have to be maintained... we are cognisant of recent developments and we will look to adjust our plans," he said. MRO refers to Maintenance, Repair and Overhaul. Currently, Air India has a fleet of 191 planes, including 64 wide-body aircraft.
