Venice AI raised $65 million at a $1 billion valuation in its first outside funding round, founder Erik Voorhees announced Wednesday. Voorhees said the company has surpassed 3 million users and become profitable, arguing that AI surveillance—not model capability—is becoming the industry's defining challenge. The round was led by Dragonfly, with participation from North Island Ventures, Coinbase Ventures, Archetype, Liquid2 Ventures, and Morgan Creek. Launched in May 2024, Venice AI is a privacy-focused alternative to mainstream AI chatbots designed to avoid storing users' conversations on centralized company servers. Venice AI native token (VVV) rose following the funding announcement and is currently trading at $13.74, up 11% over the last 24 hours. VVV emissions were also trimmed Wednesday to 3 million per year, which are awarded to token holders who stake their VVV to support the network. Voorhees wrote that the funding validates Venice's mission to build a private, uncensored alternative to mainstream AI, and that the new funding will be used to expand Venice's platform.