The cost of the latest artificial intelligence models continues to rise, causing increasing concern among corporate financial executives, who are beginning to urge employees to consider adopting open-source alternatives.

This trend is driving the growth of the cloud startup Fireworks. The company competes with Amazon (AMZN.US) and Google to provide model hosting services for developers to integrate into applications. Supported by NVIDIA (NVDA.US), Fireworks announced on Thursday that its annualized revenue has surpassed $1 billion, a fivefold increase from last year, and it has completed a $1.5 billion financing round, reaching a valuation of $17.5 billion.

Lin Qiao, co-founder and CEO of Fireworks, stated in an interview with CNBC that the company is facing "super-linear demand," describing the market opportunity as once-in-a-lifetime.

Fireworks is much smaller than Anthropic and OpenAI, both of which have valuations exceeding $800 billion this year. However, Fireworks' revenue breakthrough reflects that companies are not entirely satisfied with the models launched by large labs.

This development also indicates that Amazon, Microsoft (MSFT.US), and Google do not completely dominate the cloud computing market.

Fireworks primarily operates in the inference cloud market, providing infrastructure for model management, with competitors including Baseten and Together AI. The company has also begun offering GPUs to train AI models, with a business model similar to neocloud companies like CoreWeave, Lambda, and Nebius.

In recent years, Fireworks has started to establish partnerships. In March of this year, the company announced a collaboration with Microsoft, allowing Windows and Office customers to access model services through Fireworks, while Fireworks relies on over 20 suppliers, including Microsoft, for computing power.

Lin Qiao stated that partnering with Microsoft significantly expands their reach, and compared to similarly qualified closed models, Fireworks' costs are five to ten times lower.

The latest round of financing for Fireworks was led by Atreides Management, Index Ventures, and TCV, with NVIDIA also participating in the investment, along with other investors including Evantic and Lightspeed Venture Partners. (su)