LMArena, the company behind artificial intelligence testing service Chatbot Arena, has raised $100 million in initialj funding, marking one of the largest seed rounds in the AI sector to date.

According to Bloomberg today, the round was raised on a valuation of $600 million, a highly impressive amount given it only launched as a standalone company after being spun out of a University of California at Berkeley project in April.

LMArena operates as a neutral benchmarking platform that enables users to compare large language models through head-to-head matchups. It works by allowing users to submit prompts and evaluate anonymous responses from different models, selecting the best reply. The result is that the service offers a crowdsourced comparison method and unbiased rankings that reflect actual, real-world user preferences.

The company’s platform has become the main and arguably one of the best ways for both researchers and commercial AI developers to compare models. Major AI companies, including OpenAI, Google LLC and Anthropic PBC submit their models to LMArena to showcase performance and gather community feedback.

LMArena’s success and how it managed to gain a $600 million valuation in its first round are tied to the transparency and neutrality it brings to evaluating AI models in a rapidly growing sector. By not favoring any specific company or model, the platform has attracted participation from nearly every major company and lab that is developing large language models, giving it industry-wide relevance and legitimacy.

The company has attracted some controversy. A paper last month from Cohere Inc., Stanford University, MIT and the Allen Institute for AI, or Ai2, accused it of helping a group of AI companies — Meta Platforms Inc., OpenAI, Google LLC and Amazon.com Inc. — get better leaderboard scores at the expense of rivals, TechCrunch reported. LMArena co-founder and Executive Chairman Ion Stoica responded that study was full of “inaccuracies” and “questionable analysis” and that providers were free to submit more models for testing.

Per Bloomberg, investors were drawn to LMArena’s clear value proposition and the growing demand for third-party benchmarking as generative AI adoption expands. LMArena’s ability to generate detailed performance comparisons without the need for direct integration into third-party systems makes it highly scalable.

The funding will reportedly support platform expansion and the development of new domain-specific evaluation tools to meet increasing demand. “We believe evaluations are more important now than when we started,” Stoica told Bloomberg.

Andreessen Horowitz and UC Investments led the round, with Lightspeed Venture Partners LP, Felicis Ventures Management Co. and Kleiner Perkins Caufield & Byers also participating.

Image: LMArena