Amazon CNBC reports that the company will double the value of credits it provides to some startups to use its cloud infrastructure as competition intensifies. Microsoft In artificial intelligence services.
Starting July 1, startups that raised a Series A round in the past year will be eligible for a $200,000 credit through AWS’s Activate program, up from $100,000 previously, Amazon’s cloud division said in an email to venture capitalists this week. AWS said early-stage startups will still be eligible for the $100,000 credit.
Two people briefed on the changes confirmed the credit increase, but asked not to be identified because the information is confidential.
Matt Garman, who was recently promoted to AWS CEO after overseeing sales and marketing, met with founders in Silicon Valley this week, sources said. Garman told executives that working with startups will always be a key focus, adding that Garman described AI companies as ideal customers for AWS.
An AWS spokesperson confirmed the credit increase and Garman's visit to Silicon Valley. The spokesperson added that while the $100,000 credit previously expired after one year, the $200,000 credit now expires after three years.
Amazon, best known for its massive online retail business, makes most of its revenue from AWS, which it started in 2006, long before rivals Microsoft and Google. AWS is the market leader, with $25 billion in revenue in the first quarter, up 17% year over year.
However, Microsoft Azure and Google Cloud are growing faster and benefiting from rapidly evolving AI models. OpenAI, backed by Microsoft, launched ChatGPT on Azure in late 2022 and has since attracted AI workloads to Microsoft from companies large and small. Google has a number of large language models, most notably Gemini.
Amazon has been trying to keep up in the generative AI space, investing billions of dollars in OpenAI competitor Anthropic.
Last month, AWS CEO Adam Selipsky announced his departure after three years at the helm, and Garman was named as his successor. During Selipsky’s tenure, Microsoft and Google have gained share in the cloud infrastructure market. One analyst told CNBC that Microsoft has “beaten” AWS in generative AI.
Startups have long been fertile ground for cloud infrastructure companies. They strive to attract ambitious entrepreneurs who can create the next multi-billion dollar business.
In November, Microsoft announced a partnership with Silicon Valley accelerator Y Combinator, which would provide participating startups with $350,000 in Azure credit and access to graphics processing units (GPUs) to train AI models, a spokesperson said. Microsoft has since extended the $350,000 credit incentive to other accelerators, including its AI Grant.
Startups enrolled in Microsoft's Founders Hub program, which requires no prior venture funding, can receive up to $150,000 worth of Azure credits over four years.
In addition to the Activate product, Amazon is offering a new 10-week generative AI accelerator program. According to the website, participants can access up to $1 million in cloud credits.
On Friday morning, Amazon Chief Scientist Rohit Prasad told employees that the company had hired David Luan, co-founder and CEO of AI startup Adept, along with several of Luan’s colleagues. “Amazon is also licensing Adept’s agent technology, its suite of cutting-edge multimodal models, and several datasets,” Adept said in a blog post.
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