Venice AI hits unicorn status with $65M Series A as privacy-first platform surges

Growing unease about how AI chatbots affect mental well-being, personal security, harassment, and the spread of false information has pushed developers to introduce tighter controls on what their models can say or do. Yet despite these worries, the hunger for AI remains unshaken. People see immense promise in the technology and don’t want faceless corporations limiting their access to it. If they can also keep their privacy intact while using AI freely, the appeal becomes undeniable.

That’s exactly the niche Venice AI has carved out. The platform offers access to over 200 AI models while letting users maintain their privacy. And the demand has been explosive. Just two years after launch, Venice attracts more than 850,000 unique visitors to its site each month, serves over 3 million active users, and handles an average of 1.7 million API calls daily.

The startup hosts “uncensored,” open-source models on its own data centers and routes queries to closed-source ones like those from OpenAI or Anthropic. Every piece of user input is encrypted and decrypted on the client side, then sent through an external proxy before processing and returning results. No data is stored on Venice’s own systems. Some models even offer end-to-end encryption, though that requires a paid subscription.

The company is already profitable, with annualized run-rate revenues exceeding $70 million, CEO Erik Voorhees told TechCrunch in an exclusive interview.

Investors have naturally taken notice. On Wednesday, Venice AI announced it had raised a $65 million Series A at a $1 billion valuation , its first external fundraising round. The round was led by crypto-focused venture firm Dragonfly, with participation from Coinbase Ventures, North Island Ventures, and others.

The connection between Voorhees, Venice’s emphasis on privacy, and its new crypto investors is hard to overlook, especially given Voorhees’ background. An early bitcoin advocate, he founded crypto companies like bitcoin gambling site Satoshi Dice and cryptocurrency exchange ShapeShift, and has long championed user privacy. When a Wall Street Journal investigation accused ShapeShift , which initially didn’t require user identification , of processing millions in suspect funds, Voorhees reportedly said, “I don’t think people should have their identity recorded to catch an occasional criminal.”

He struck a similar tone when asked how Venice AI approaches offering access to AI models in light of recent cases of AI-related psychosis and harm. Voorhees described 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.”

User agency is a central focus. People can freely choose from AI models that generate text, images, audio, and video , each varying in performance, quality, and the level of censorship applied. The website prominently features several AI “characters” that users can customize and chat with, and the company proudly advertises an “uncensored” experience.

“We’re optimizing for freedom and actually respecting users as adults, which is, I think, rare these days,” Voorhees said.

He added that Venice also works on some open models’ system prompts to encourage more open responses, though it doesn’t impose any restrictions on the models themselves.

Two crypto tokens are tied to the platform. Venice launched a token called “VVV” in early January to attract users, Voorhees said, and added another, “DIEM,” in August last year. Users can buy VVV and stake it to mint DIEM, which generates $1 worth of AI credits per day that can be spent on Venice. Still, Voorhees noted that only about 8% of users pay with crypto.

The CEO credited the company’s growth to the strong performance of the crypto tokens, but said the biggest driver was reaching near 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.

Looking ahead, Venice AI plans to use the fresh capital to start buying GPUs and building its own data centers, reducing reliance on leased hardware and boosting its gross margins.