Bezos and Samsung bet 700 million on startup that wants to beat Nvidia
In the field of artificial intelligence, there is an increasingly intense competition for dominance in the field of high-performance chips. One of the new players trying to capture a slice of this lucrative market is startup Tenstorrent. This Canadian startup, which aims to compete with Nvidia, has received a significant investment of $700 million. Amazon founder Jeff Bezos, South Korean firm Samsung and other large companies are among the investors. Tenstorrent is focused on developing chips that would offer a more efficient and affordable alternative to the technologies that dominate the AI market.
Tenstorrent, a startup focused on developing chips for artificial intelligence, can rejoice in a new $700 million investment led by South Korea's AFW Partners and Samsung Securities. The move has led to a valuation of the startup at $2.6 billion. Jeff Bezos, founder of Amazon, joined the investment through his firm Bezos Expeditions, backing the team around well-known engineer Jim Keller. Tenstorrent has earned the trust of major investment and technology players, including LG Electronics and Fidelity, who believe in its capabilities and potential.
Tenstorrent's goal is to develop chips that would rival Nvidia's $NVDA in AI. Nvidia, the dominant player in the AI chip field, is facing pressure from smaller companies trying to offer cheaper and more power-efficient solutions. Jim Keller, founder of Tenstorrent, said it is possible to compete with Nvidia without using expensive components such as High Bandwidth Memory (HBM), which Nvidia is using massively. Instead, Tenstorrent is focusing on open standards and simple technologies that would enable lower prices and better availability to a wider range of customers.
One of the key differences between Nvidia and Tenstorrent lies in the philosophy behind their approach to chip design. Nvidia offers a comprehensive technology that includes not only the chips themselves, but also interconnects and data center designs that are designed to ensure that all components work in perfect symbiosis. Tenstorrent, on the other hand, focuses on compatibility with broader technology standards and an open approach to enable collaboration with other vendors.
Another important step for Tenstorrent is to support open standards such as RISC-V, an alternative to Arm Holdings' dominant processor. Keller, who has had a successful career designing chips for companies such as Apple $AAPL, Tesla $TSLA and AMD $AMD, sees an open approach as key to the future and growth of the entire field. This approach attracts engineers and partners who are looking for innovation based on open technologies.
While Tenstorrent is still at the beginning of its journey, it has already signed contracts worth around $150 million, which is still a small proportion compared to the sales of Nvidia, which generates billions of dollars each quarter from data centre chip sales. However, the startup plans to release new chips every two years, while Nvidia releases new products every year. That time frame could give Tenstorrent room to grow and innovate.
The investment will also support the expansion of the engineering team and investment in the global supply chain and the development of large AI training servers that will be used to demonstrate the capabilities of their chips. The startup is also focused on leveraging advanced manufacturing technology, including 2nm chips, a step towards even more efficient and powerful solutions.
Other investors in this round of funding include Export Development Canada, Healthcare of Ontario Pension Plan, Hyundai Motor Group and Baillie Gifford, confirming the growing confidence in Tenstorrent and its potential in the AI space.
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Source: Yahoo Finance, WSJ.
