Key Takeaways
- • Tenstorrent raised $1.5 billion at a $6.2 billion valuation, more than doubling its $2.6 billion valuation from late 2024.
- • The round was led by Trace Capital, a newly launched firm founded by Quiet Capital co-founder Ben Mahdavi, and Innovation X, with participation from Cadence Ventures, Eclipse, Fidelity, SanDisk, and T. Rowe Price.
- • The raise follows reported acquisition interest from Intel and Qualcomm at valuations of as much as $5 billion, which Tenstorrent declined in favor of independence.
- • CEO Jim Keller told Bloomberg the company's Galaxy servers demonstrated the ability to run DeepSeek models, and the new capital will fund chips for serving open-weight AI models and video generation.
Summary
Tenstorrent, an inference-focused chip startup, has raised $1.5 billion at a $6.2 billion valuation, according to the company's announcement reported by Bloomberg and the original article. The round more than doubles the $2.6 billion valuation the company achieved in late 2024 and comes roughly five months after the 10-year-old Nvidia challenger reportedly received acquisition interest from Intel and Qualcomm at valuations of as much as $5 billion.
The round was led by Trace Capital, a new firm launched by Quiet Capital co-founder Ben Mahdavi, and Innovation X. Other participants included Cadence Ventures, Eclipse, Fidelity, SanDisk, and T. Rowe Price. The mix of growth-stage and strategic investors reflects continued institutional appetite for AI hardware companies positioned against Nvidia's dominant share of the market.
Jim Keller, the microprocessor engineer who serves as Tenstorrent's CEO, told Bloomberg that the company chose to remain independent and raise additional capital after its Galaxy servers demonstrated the ability to run DeepSeek models. The new funding will support development of chips tailored for serving open-weight AI models and for video generation workloads.
Tenstorrent is part of a broader wave of AI hardware startups seeking to erode Nvidia's position. TechCrunch reported earlier in the month that Etched, another AI chip developer, was fielding investment offers at valuations of $40 billion or more, underscoring the premium investors are placing on alternative AI silicon.
The round was led by Trace Capital, a new firm launched by Quiet Capital co-founder Ben Mahdavi, and Innovation X. Other participants included Cadence Ventures, Eclipse, Fidelity, SanDisk, and T. Rowe Price. The mix of growth-stage and strategic investors reflects continued institutional appetite for AI hardware companies positioned against Nvidia's dominant share of the market.
Jim Keller, the microprocessor engineer who serves as Tenstorrent's CEO, told Bloomberg that the company chose to remain independent and raise additional capital after its Galaxy servers demonstrated the ability to run DeepSeek models. The new funding will support development of chips tailored for serving open-weight AI models and for video generation workloads.
Tenstorrent is part of a broader wave of AI hardware startups seeking to erode Nvidia's position. TechCrunch reported earlier in the month that Etched, another AI chip developer, was fielding investment offers at valuations of $40 billion or more, underscoring the premium investors are placing on alternative AI silicon.
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