Funding
Koah Secures $20.5M in Series A to Build AI-Native Monetization
San Francisco-based Koah has raised $20.5 million in a Series A funding round led by Theory Ventures, bringing its total funding to more than $26 million. The round follows a $5 million seed raise in September 2025 and underscores growing investor interest in infrastructure purpose-built for generative AI.
As AI chatbots, search assistants, and copilots increasingly become primary interfaces for discovering information, comparing products, and making decisions, the economics behind those tools are under pressure. Subscription models alone often struggle to offset high inference costs, particularly for consumer-facing products with heavy usage. Meanwhile, traditional banner ads and feed-based placements feel misaligned inside conversational environments. Koah is focused on building a monetization layer native to how AI applications actually function.
How AI-Native Advertising Works Inside Conversations
Koah provides a lightweight SDK that integrates directly into generative AI products. Once installed, the system connects the application to Koah’s ad-serving and contextual matching infrastructure. Instead of relying on static keywords or page-level targeting, the technology analyzes live conversational context.
When a user asks an AI assistant a question — for example, comparing laptops, researching travel destinations, or exploring financial tools — that interaction often reveals explicit intent. Unlike traditional web browsing, where intent must be inferred from limited signals, conversational AI captures full-sentence queries and multi-turn dialogue. This produces a richer, more structured intent signal.
Koah’s infrastructure uses that context to determine whether a relevant sponsored message can be introduced in a way that aligns with the user’s inquiry. Rather than displaying a banner beside the conversation, the ad appears natively within the response stream. The format is designed to resemble a contextual suggestion or informational extension, integrated into the chat flow.
On the advertiser side, the system allows brands to align with real-time user intent. Instead of bidding solely on search keywords, advertisers can connect to conversational moments where users are actively evaluating options or seeking expertise. Koah has also introduced analytics tools to track engagement and performance within these AI-native placements, offering visibility into how users interact with sponsored content inside chat environments.
Early Scale and Ecosystem Growth
Over the past year, Koah reports that its ecosystem has grown to more than 2 million monthly active users engaging with conversational AI multiple times per day. The company has served more than 35 million native ad impressions across roughly 175 million queries. Its SDK is already embedded in high-engagement AI applications, helping developers test monetization strategies beyond subscriptions.
The participation of Tomasz Tunguz — Founder and General Partner of Theory Ventures and a former Google AdSense team member — signals investor belief that conversational AI represents a structural shift in how the internet is navigated and monetized.
How AI-Native Monetization Could Reshape the Digital Economy
The broader implications extend beyond a single company. If generative AI becomes the dominant interface layer for search and discovery, the underlying revenue infrastructure of the internet may evolve alongside it.
Conversational systems change the nature of intent signals. Users articulate needs directly, often across multiple turns, creating opportunities for more precise alignment between content and commerce. In theory, this could reduce irrelevant advertising while increasing performance efficiency. At the same time, embedding monetization directly into AI responses raises questions around transparency, user trust, and disclosure standards.
Developers may increasingly design products with built-in monetization layers from day one, rather than retrofitting revenue strategies after scale is achieved. Advertisers, in turn, may shift budgets toward AI-driven environments where decision-making is happening in real time.
As generative AI continues to mediate research, recommendations, and purchasing behavior, the companies building monetization infrastructure for these environments will play a defining role in shaping how value flows across the next phase of the internet.
