Summary:
Jeff Bezos leads a $700 million investment in Tenstorrent, aiming to compete with Nvidia.
Tenstorrent plans to expand its engineering team and enhance its global supply chain.
The startup focuses on cost-effective and power-efficient AI chip solutions using open-source technology.
Tenstorrent advocates for interoperability and supports the open-standard RISC-V architecture.
The company aims to release a new AI processor every two years, exploring 2-nanometer chip designs.
Major Investment in AI Chips
Jeff Bezos, the founder of Amazon, has reportedly led a $700 million funding round for Tenstorrent, an innovative AI chip startup, which has now reached a valuation of $2.6 billion. This investment was co-led by Samsung Securities and AFW Partners, positioning Tenstorrent as a significant competitor to Nvidia, the current leader in the AI chip market. Other notable investors include LG Electronics, Fidelity, and Hyundai Motor Group.
Tenstorrent's Ambitious Plans
Based in Santa Clara, California, Tenstorrent plans to utilize this funding to:
- Expand its engineering team
- Enhance its global supply chain
- Develop AI training servers to showcase its technology
The startup is focused on creating chips that are more cost-effective and power-efficient for AI development, aiming to leverage open-source technology while avoiding the expensive high-bandwidth memory (HBM) that Nvidia relies on. As CEO Jim Keller stated, "You can’t beat Nvidia if you use HBM, because Nvidia buys the most HBM and has a cost advantage."
Embracing Interoperability
Unlike Nvidia, which maintains a proprietary ecosystem, Tenstorrent advocates for interoperability with other tech providers and supports the open-standard RISC-V processor architecture. Keller believes this approach will attract engineers and foster innovation.
A Growing Trend in AI Chips
Tenstorrent’s strategy aligns with a rising trend within the AI chip sector, where startups are actively challenging Nvidia's supremacy by providing tailored alternatives. Although Nvidia earns tens of billions in data center revenue quarterly, Tenstorrent has already secured contracts worth nearly $150 million, indicating its potential.
The company aims to release a new AI processor every two years. Its initial chips were produced by GlobalFoundries, with future models planned through TSMC and Samsung. Tenstorrent is also investigating 2-nanometer chip designs, collaborating with TSMC and Japan’s Rapidus Corp., which anticipates 2nm output by 2027.
As Tenstorrent scales, it must demonstrate its technology's viability in a market dominated by Nvidia. However, with strong backing from prominent investors and an innovative open-source strategy, Tenstorrent is set to become a formidable player in the AI chip landscape.
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