By late 2022 Grammarly found itself navigating a much more competitive landscape. Once the default assistant for writers seeking grammar help and tone suggestions, the company faced pressure from general-purpose AI platforms like OpenAI’s ChatGPT and later, Microsoft Copilot, tools capable not just of editing but generating entire documents and communications. With AI writing help being freely available, did Grammarly manage to adapt? Well, for one, their revenue grew in 2023 and 2024.
The other part of the answer came this week, when the company announced a $1 billion nondilutive financing round from General Catalyst. The capital will support Grammarly’s move from a specialized writing assistant to a broader AI productivity platform. The funding follows its December 2024 acquisition of Coda, a productivity software startup, and a leadership transition that brought former Coda CEO Shishir Mehrotra to the helm.
The financing was raised through General Catalyst’s Customer Value Fund. According to General Catalyst CEO Hemant Taneja, “We’ve been working with the Grammarly team for years as they became an early leader in applied AI.” He added, “We are confident that this extension of our partnership will create significant long-term value and continue to drive Grammarly’s ability to accelerate enterprise adoption.”
