Rachad Alao, Vice President of Product Engineering at Cohere, argued at VB Transform 2026 in Menlo Park that enterprise AI sovereignty means controlling the entire technology stack, from GPUs and private cloud to governance systems that route model requests. Speaking with VentureBeat CEO Matt Marshall, Alao stressed that sovereignty goes beyond using an open model or running an app behind a firewall.
Full control for mission-critical systems
For banks, hospitals, and governments, Alao emphasized the need for tight control over where data resides and how AI operates. This includes physical infrastructure, model routing, connectors, and agent frameworks. "You want control on the entire stack," he said. Cohere distinguishes itself from token-based pricing by focusing on solving enterprises' hardest problems privately and securely, while reducing unnecessary model usage.
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Token consumption rises despite falling prices
Marshall questioned whether declining inference costs reduce the need for smaller local models. Alao countered that total token consumption is growing exponentially as enterprises move from simple chatbots to complex agents that reason, call tools, and search internal systems. "Your token utilization is going exponentially up because you're dealing with more complex agentic use cases," he said. These workflows require significant processing, thinking, and tool interaction.
Intelligent model routing
Rather than sending every request to the largest frontier model, enterprises should route tasks based on required intelligence and regulatory sensitivity. Alao cited a Canadian bank using Cohere's on-premises models for regulated workloads while routing less sensitive tasks to larger frontier models via the North platform. "Model routing can become super useful," he noted. Cohere's open-source North Mini Code, running on a single Nvidia H100, targets agentic software engineering. For 80% of use cases, it proves more effective and cheaper. Additionally, the Command A+ model, with 218 billion parameters (25 billion active), offers an Apache 2.0 license for flexible deployment.
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Multimodal search as agent component
Alao highlighted that enterprise search is evolving beyond text retrieval to multimodal search across documents, images, and more. This becomes an integral part of the agentic workflow, with the model deciding when to use retrieval like any other tool. To persuade enterprises to move beyond bundled cloud AI services, Alao emphasized data control and portability. Cohere's governance layer lets customers route traffic appropriately, "breaking that vendor lock-in concern."
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Related reading: OpenAI built GPT-Red, an LLM super-hacker for safety testing and Meta now alerts parents when teens discuss suicide with its AI chatbot. For more, visit Cohere's Wikipedia page.
