Artificial intelligence coding startup Poolside Inc., a rival to GitHub Inc.’s Copilot, said today it has closed on a bumper $500 million Series B raise.

Today’s funds came from Bain Capital Ventures, which led the round, and it was joined by a number of globally renowned companies. They included eBay Inc., Nvidia Corp., Citi Ventures, HSBC Ventures and LG Technology Ventures, plus venture capital firms such as DST Global, StepStone Group, Schroders Capital, Premji Invest, Dorsal Capital, BAM Elevate, Adams Street and Fin Capital. The lengthy list of investors also included the startup’s existing backers, Felicis Ventures and Redpoint Ventures, which led the company’s $100 million Series A and $26 million seed rounds, respectively.

The round brings Poolside’s total amount raised to date to $626 million, and it’s now valued at a cool $3 billion, according to a report in Bloomberg.

The long list of investors and the huge amount of money raised suggests Poolside is onto something special with its generative AI-powered coding assistant models, which are an alternative to GitHub’s popular Copilot. Indeed, there’s every reason to think its technology should be just as good, if not better, since Poolside co-founder and Chief Executive Jason Warner formerly worked as the chief technology officer of GitHub, having previously headed engineering at Canonical Ltd. and Heroku Ltd.

Warner co-founder Eiso Kant, who is now Poolside’s CTO, also has a strong pedigree, having previously founded a number of developer tech-focused startups.

Poolside has developed its own generative AI coding models, designed to help developers with things such as auto-completion of code and suggesting lines of code that are relevant in a particular context or for a specific codebase. The startup claims a number of Global 2000 companies as customers, though it has disclosed only a handful of them on its website.

Where Poolside stands out from other AI coding rivals is through its reinforcement learning-based approach to training its models. Reinforcement learning enables its models to learn over time based on code execution feedback, so they will constantly improve as they complete millions of tasks in real-world software projects.

The startup is also building a custom stack, or software toolkit for AI training tasks, complete with features that enable researchers to manage the datasets used in their machine learning projects. Its software also includes tools for automating tasks such as measuring the accuracy of newly-built large language models.

In a statement, Warner said he believes that only a handful of companies will eventually achieve what’s known as “artificial general intelligence,” which is a more advanced form of AI that would effectively think and learn by itself, in the same way as humans can. AGI, the potential for which remains controversial, is exactly what Poolside claims to be building.

“We believe software development will be the first broad capability where AI will reach and surpass human-level intelligence,” Warner said. “Through our team, our applied research and a powerful revenue engine, Poolside will bring AI for software development so that anyone in the world can build.”

Poolside added that the money from today’s round is already being put to use, as it has already invested in a batch of 10,000 Nvidia graphics processing units for training its future models. The funds will also help to boost its go-to-market and research and development initiatives, the company said.

Although there remain serious concerns about the security and reliability of AI code generation tools, with many thought to be guilty of plagiarizing existing code, developers have shown lots of enthusiasm for them. In a recent poll by GitHub, an overwhelming majority of respondents said they’re using AI tools to assist their development work. GitHub itself has accumulated more than 1.8 million paying users for its Copilot assistant.

Poolside isn’t the only AI coding startup to attract megabucks from VCs either. Its rivals include Magic AI Inc., which bagged $200 million in fresh funding in July, and there are many others, such as Augment Inc., which closed on a hefty $227 million Series B round that lifted its valuation to $977 million. Meanwhile, Cognition AI Inc., creator of Devin, closed on a $175 million funding round led by Founders Fund in March, bringing its value to $2 billion.

The likes of Amazon Web Services Inc. and Google LLC also compete with their CodeWhisperer and Gemini Code Assist tools, and various startups exist, such as Tabnine Ltd., Codegen Inc., Refact, Laredo Labs Inc. and TabbyML Inc.

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