A new British artificial intelligence company founded by former Google DeepMind researchers is seeking to raise as much as $700 million, potentially giving the month-old start-up a valuation of about $3.7 billion.
Emulate, which was incorporated in August, is in advanced discussions with investors over the fundraising, according to people familiar with the deal. Index Ventures and Lightspeed Venture Partners are expected to jointly lead the round.
The speed at which Emulate has attracted potential investment highlights the intense competition among investors for emerging artificial intelligence companies and leading AI researchers.
The company was founded by former DeepMind researchers Jack Parker-Holder, Matthew McGill and Philip Ball, who previously worked on Genie, a technology capable of generating realistic videos and interactive three-dimensional environments from relatively short prompts.
Genie and related “world model” technology are designed to help AI systems understand and simulate physical environments. The approach is viewed as a developing area of AI research beyond the large language models that power popular systems such as ChatGPT, Gemini and Claude.
Emulate has been operating largely in stealth mode since its creation, meaning relatively little information about its products and commercial plans has been made public.
Its emergence nevertheless adds to a growing wave of AI start-ups being created by researchers leaving established technology companies. These new ventures are attracting substantial amounts of venture capital at very early stages, in some cases before they have launched commercial products.
The trend reflects investors’ growing willingness to place large bets on AI researchers with experience at leading technology laboratories. The expectation is that their expertise and previous work could provide a foundation for developing valuable new AI systems.
Emulate is the third major UK AI spin-off linked to former DeepMind researchers to attract significant funding this year. Other ventures have also secured multibillion-dollar valuations, illustrating the strength of investor demand for companies operating at the frontier of artificial intelligence.
The company’s founders previously contributed to the development of Genie, whose capabilities in generating interactive environments attracted significant attention from the technology and video-game industries. The technology demonstrated how AI models could potentially be trained not only on text but also to understand elements of physical space and how environments behave.
World models are considered particularly promising because they could eventually support applications in areas such as robotics, simulation, gaming and autonomous systems. However, the technology remains at an early stage and significant computing resources are required to develop increasingly sophisticated models.
For Emulate, one of the immediate challenges will be converting the reputation and research experience of its founding team into commercially viable technology. The company will also face the high costs associated with computing infrastructure and competition for highly skilled AI researchers.
The proposed fundraising nevertheless demonstrates how quickly investor interest can translate into large valuations in the current AI market. A company established only in August could potentially command a multibillion-dollar valuation before publicly establishing a major commercial product.
The development also underlines the changing structure of the AI industry, where talent from established laboratories is increasingly becoming the foundation for new companies competing for capital, researchers and computing resources.
If completed, Emulate’s fundraising would rank among the latest major investments in Britain’s rapidly expanding AI start-up ecosystem.
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