AI21 Labs

Deep NLU Roots

Founded: 2017 | HQ: Tel Aviv, Israel | Key People: Amnon Shashua (Co-founder & Co-CEO), Yoav Shoham (Co-founder & Co-CEO), Ori Goshen (Co-founder) | Valuation: ~$1.4 billion (in acquisition talks, May 2026) | Flagship Models: Jamba 1.5, Jamba 2, Jurassic-2, Maestro

The Origin Story

AI21 Labs was founded in 2017 in Tel Aviv by Professor Amnon Shashua (also co-founder of Mobileye), Professor Yoav Shoham (a Stanford AI professor and former Google Fellow), and Ori Goshen, years before the generative AI boom made language model companies fashionable. The founding vision was rooted in natural language understanding — specifically, the conviction that true AI required not just pattern matching over text but genuine comprehension of meaning, structure, and reasoning. Shashua brought entrepreneurial pedigree from Mobileye's successful IPO and eventual $15.3 billion acquisition by Intel; Shoham brought deep academic credibility in AI, having published foundational work on multi-agent systems and game theory. The company's first major product was Wordtune, a browser extension that used AI to help users rewrite and refine text. Wordtune gained millions of users as a writing assistant, providing both a revenue stream and a rich source of training data for language understanding. But the real ambition was always foundational: building large language models that could reason, not just generate. The Jurassic model family, beginning with Jurassic-1 in 2021, was among the earliest commercial LLMs, predating ChatGPT by over a year and competing directly with GPT-3.

Key Milestones

Jurassic-1, released in August 2021, offered 178 billion parameters in its Jumbo variant, making it one of the largest publicly available language models at the time. Jurassic-2 followed with improved multilingual capabilities and 1.2 trillion training tokens. A $155 million Series C in August 2023, led by Google and Nvidia, valued AI21 at $1.4 billion and signaled that major technology companies saw strategic value in the Israeli lab's approach. The company's architectural innovation culminated in the Jamba model family, which introduced a hybrid Mamba-Transformer architecture — combining the computational efficiency of state-space models with the expressiveness of attention mechanisms. Jamba 1.5, released in 2024, offered a 256K context window with strong performance at significantly lower inference cost than pure Transformer competitors. Jamba 2 continued refining this architecture, with variants including Jamba2 Mini and Jamba Reasoning 3B, all released with open weights for enterprise deployment. In March 2025, AI21 launched Maestro, an AI orchestration system designed for automating complex, data-intensive enterprise tasks with built-in accuracy validation and traceability — targeting finance, legal, and healthcare workflows. Customers include Boston Consulting Group, Bain & Company, Moderna, Amgen, and Booking.com. A reported $300 million Series D in May 2025, supposedly led by Nvidia and Alphabet, was later revealed to have never formally closed. By late 2025, Nvidia was reported to be in advanced talks to acquire AI21 for $2-3 billion, focused primarily on acquiring the company's team of highly trained AI researchers rather than commercial products. AI21 was generating approximately $50 million in annualized revenue at the time.

The Acquisition Saga

Nvidia ultimately walked away from acquisition discussions, and by May 2026, Nebius Group — a Dutch AI cloud computing company listed on NASDAQ under the ticker NBIS — emerged as the leading bidder. The discussed valuation has reportedly dropped to approximately $1.4 billion, a significant decline from the $2-3 billion range discussed during Nvidia's interest. AI21 has denied ongoing sale talks publicly, though multiple reports indicate the company is actively seeking an exit. The company generates approximately $50 million in annual revenue and employs a research team of roughly 200 people. As of late May 2026, no acquisition has been confirmed, and the situation remains unresolved.

Current Position

AI21 occupies an increasingly precarious position. Technically, the company has produced genuinely innovative architecture with the Jamba hybrid model family, and its Maestro orchestration platform addresses a real enterprise need for reliable, auditable AI workflows. The 200-person research team represents significant talent that has attracted multiple acquisition suitors. But commercially, AI21 has been unable to translate technical innovation into commercial momentum. With approximately $50 million in revenue and a valuation that has declined from $2-3 billion to $1.4 billion in acquisition discussions, the company appears to be running out of options for continued independent operation. The shift from Nvidia to Nebius Group as the likely acquirer signals the specific value proposition: AI21's research talent would complement Nebius's AI cloud infrastructure, creating a full-stack AI offering. However, AI21's public denial of sale talks introduces additional uncertainty for enterprise customers.

What Leaders Should Know

AI21's Jamba models offer a compelling technical proposition for enterprises that need efficient inference on long-context tasks without the cost of frontier models from larger providers. The hybrid architecture genuinely delivers better performance per dollar for certain RAG and document analysis workloads. However, the ongoing acquisition uncertainty — with Nebius Group as the latest suitor after Nvidia walked away — introduces significant risk for enterprise customers building on AI21's platform. The declining valuation in acquisition talks ($1.4 billion vs. the earlier $2-3 billion range) suggests market skepticism about AI21's standalone commercial prospects. Organizations considering AI21 should evaluate the Jamba models on technical merit while maintaining firm migration plans to alternative providers. Maestro's orchestration capabilities remain noteworthy for regulated industries requiring AI workflow auditability, but the product's long-term trajectory depends on the outcome of the unresolved acquisition discussions.