Suno raises $400 million at $5.4 billion valuation

Investing.com -- Suno Inc., an artificial intelligence music creation startup, secured $400 million in new funding at a $5.4 billion valuation on Wednesday.

Bond Capital led the financing round with participation from IVP, Forerunner and Union Square Ventures. Previous backers Lightspeed and Menlo Ventures also joined the round.

The company's valuation has doubled since its $250 million funding round seven months ago. The latest investment makes Suno the highest-valued company among AI music startups.

Suno's platform lets users generate music through text prompts. Users can specify genres, sounds, instruments and lyrics to receive a digital recording within seconds.

The startup will deploy the funds to expand hiring, build new products and support growth following a strong year opening, according to co-founder and CEO Mikey Shulman. The company currently employs about 200 people and aims to grow its workforce by up to 70% before the end of the year.

Suno passed 2 million subscribers in February and is tracking toward $300 million in annual revenue.

"Having more capital allows us to operate the business differently and take some bigger swings," Shulman said. He noted that user engagement time has risen while subscription cancellations have fallen. "A higher share of users are falling in love with the product and coming back."

Bond Capital has previously invested in OpenAI and Kalshi.

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