AI developers are installing safeguards to control how their models respond, driven by worries about mental health, safety, harassment, and disinformation.
That demand does not fade. Users want access to the technology without handing control to a faceless corporation. If they can keep their data private while using the tools freely, they will.
Venice AI raises m
Venice AI capitalises on that preference. The platform gives access to more than 200 AI models while keeping user privacy intact. Two years in, the company has attracted more than 850,000 unique visitors to its website. It serves more than 3 million active users and processes an average of 1.7 million API calls every day.
The startup hosts uncensored, open source models on its own data centres. It routes queries for closed-source models, such as those by OpenAI or Anthropic, through its infrastructure. All user input is encrypted client-side and routed through an external proxy before processing. No data is stored on Venice’s own systems. Some models offer end-to-end encryption, but that feature requires a paid subscription.
The business is already profitable. CEO Erik Voorhees told TechCrunch during an exclusive interview that annualised run-rate revenues exceed $70 million.
Investors moved in quickly. Venice AI announced on Wednesday that it had raised a $65 million Series A at a $1 billion valuation. This was the company’s first external fundraise. The round was led by crypto-focused venture firm Dragonfly, with participation from Coinbase Ventures, North Island Ventures, and others.
The CEO’s background
The connection between Voorhees, the focus on privacy, and the new crypto investors is clear. Voorhees is an early bitcoin advocate. He has founded several crypto companies, including the bitcoin gambling site Satoshi Dice and the cryptocurrency exchange ShapeShift. He has long argued for preserving user privacy.
When a Wall Street Journal investigation accused ShapeShift of processing millions of suspect funds without requiring user identification, Voorhees reportedly said: “I don’t think people should have their identity recorded to catch an occasional criminal.”
He made a similar point when asked how Venice AI handles recent cases of AI psychosis and resulting harm. He stated his team treats the service as a “neutral tool or a neutral platform.”
“This is the same principle that you have in Bitcoin, where Bitcoin, as a neutral protocol, works the same way for all people,” he said. “I think it’s actually quite dangerous from a safety perspective, for the world to enter this next phase and have everyone be constantly watched. To me that is actually much more dangerous than any particular person asking a controversial question or something that might be considered bad.”
Choice and agency
Users can freely choose from AI models that generate text, images, audio, and video. These vary in performance, quality, and the level of censorship applied. The website features several AI “characters” that users can customise and chat with. The company states it offers an uncensored experience.
“We’re optimizing for freedom and actually respecting users as adults, which is, I think, rare these days,” Voorhees said.
The founder noted that Venice also works on some open models’ system prompts to instruct them to answer more openly, without adding restrictions to the models themselves.
Crypto and growth
Two crypto tokens are associated with the effort. Venice launched a token called VVV in early January to attract users. In August last year, it added another token called DIEM. Users can buy VVV and stake it to mint DIEM, which generates $1 worth of AI credits per day for spending on Venice. Voorhees said only about 8% of the company’s users currently pay with crypto.
The founder credited the performance of the crypto tokens for some growth. He said the strongest driver was getting close to feature parity with ChatGPT.
“When we launched, we were very far away from what ChatGPT could do, but people would use us because it was private. And today, we’re very close to what ChatGPT can do […] so as we’ve closed that gap, it’s become an increasingly compelling alternative,” he said.
Venice AI plans to use the new cash to buy GPUs and build its own data centres. This move will allow it to stop leasing GPUs and improve its gross margins.
