Instinct, the AI assistant startup founded by Noah Shinn, is in talks to raise about $1 billion in a funding round led by Sequoia Capital and Benchmark, aiming for a $10 billion valuation.

The deal is not finalized yet, and terms as well as lead investors could change as discussions continue.

This proposed round follows a rapid climb from a $2.5 billion Series B valuation just weeks earlier, with total capital raised reaching about $350 million across seed and Series B rounds.

The move reflects a broader trend of rising AI-startup valuations, as peers like Cognition and Clay secure large rounds and investors favor market position over immediate profits.

Lead fundraising firms Sequoia Capital and Benchmark are involved, per The Information and people familiar with the matter.

Instinct debuted earlier this year to select users and can handle tasks such as replying to texts and booking reservations; access has been expanding beyond invites, with user numbers surpassing 100,000.

Instinct has grown to over 100,000 users but faces challenges, including no monetization model yet, high compute needs for autonomous agents, and competition from Meta’s free Muse launched on September 8.

Cognition recently raised $2 billion at a $48 billion valuation, while Clay raised $115 million at a $7.1 billion valuation, illustrating booming funding in the space.

The targeted $10 billion valuation is notably higher than Sphere Street’s previous round, in which it raised $250 million at about a $2.25 billion valuation.

Investors are prioritizing scalable, autonomous AI technologies and market dominance as competition in the AI assistant space intensifies.