Samsung and Jeff Bezos, along with other investors, have made a broad move to disrupt the AI chip market dominated by Nvidia by investing $700 million in Tenstorrent, a promising AI chip startup. Tenstorrent's valuation is above $2.6 billion, indicating a growing ambition to disrupt the present AI hardware landscape.
Targeting NVIDIA’s Stronghold
Tenstorrent is a Santa Clara, California, startup that plans to provide chips that are inexpensive and power-efficient compared to Nvidia's proprietary solutions. The company uses open-source technology and avoids the costly high bandwidth memory (HBM) components at the heart of Nvidia's products. CEO Jim Keller, a veteran of Apple, Tesla, and AMD, noted that competing directly with Nvidia on HBM is impractical due to their cost advantage but expressed confidence in Tenstorrent's ability to innovate at lower costs.
A Collaborative Push
AFW Partners and Samsung Securities, both based in South Korea, are providing the funding. LG Electronics, Fidelity, and Bezos Expeditions are all investing. The startup plans to use the new capital to expand its engineering team, strengthen its supply chain and produce an AI training server demo to demonstrate its chip technology.
Samsung Electronics and TSMC are going to play an essential role in the manufacturing process of the next generation of Tenstorrent chip production. By 2025, Tenstorrent plans to move into 2nm processor technology and expects to release new AI chip designs every two years according to the development of high-end semiconductors.
Why It Matters
The AI bomb has increased demand for high-end CPUs that fuel machine learning applications. While Nvidia has made considerable money from the trend, Tenstorrent has been planning to enter this booming industry. Samsung is diversifying its chances as it prepares for a potential large-scale order from foundry operations.
This endeavor builds on Jeff Bezos's track record of backing processing breakthrough technologies with revolutionary potential. Collectively, these strategic investments may accelerate Tenstorrent's capacity to disrupt the AI business and challenge Nvidia's dominant position.