AI & Tech · National
AI chip startup Tenstorrent raises $1.5 billion at a $6.2 billion valuation to scale chips for open-weight models
Tenstorrent, a 10-year-old Nvidia challenger focused on inference chips, raised $1.5 billion and more than doubled its valuation, TechCrunch reported. The company chose to stay independent after earlier acquisition interest.
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What happened
Tenstorrent, a chip startup that focuses on inference, has raised $1.5 billion in a funding round that values the company at $6.2 billion, TechCrunch reported. TechCrunch described the 10-year-old company as a challenger to Nvidia.
The new valuation is more than double the $2.6 billion the company was valued at in late 2024, according to TechCrunch. The round also comes five months after Intel and Qualcomm reportedly showed interest in acquiring Tenstorrent at valuations of as much as $5 billion.
Who put money into the round
Lead investors
TechCrunch reported that the round was led by two firms, Trace Capital and Innovation X. Trace Capital is a new firm launched by Ben Mahdavi, a co-founder of Quiet Capital.
Other backers
Other investors in the round included Cadence Ventures, Eclipse, Fidelity, SanDisk and T. Rowe Price, according to TechCrunch. The report did not break down how much each investor contributed.
Why Tenstorrent stayed independent
Earlier acquisition interest
TechCrunch said the reported interest from Intel and Qualcomm came at valuations of up to $5 billion. The new funding round places Tenstorrent's value above that level, at $6.2 billion.
The DeepSeek demonstration
Jim Keller, Tenstorrent's CEO and a prominent microprocessor engineer, told Bloomberg that the company chose to remain independent and raise more capital after it showed its Galaxy servers could run DeepSeek models. TechCrunch cited Keller's comments to Bloomberg in its report.
Where the money is going
The new capital will go toward scaling chips designed for serving open-weight AI models and for video generation, TechCrunch reported. Readers following the business side of artificial intelligence can find related briefs in our AI and tech coverage.
A growing field of Nvidia challengers
TechCrunch placed Tenstorrent within a wave of AI hardware startups working to erode Nvidia's dominance. The report named one other company in that group.
Etched
Etched, an AI chip maker, was fielding investment offers at valuations of $40 billion or more, TechCrunch reported earlier this month. The report did not say whether Etched had accepted any of those offers.
What the report does not say
The TechCrunch article did not give details on Tenstorrent's revenue, its customers or a timeline for when its scaled-up chips would be available. It also did not say whether the reported Intel and Qualcomm interest turned into formal offers. The report does not mention any Tenstorrent operations or effects in Nevada.
What to watch next
- How Tenstorrent puts the $1.5 billion toward scaling chips for open-weight AI models and video generation, the use TechCrunch said the money is intended for.
- Whether Etched closes a funding round, after TechCrunch reported earlier this month that it was fielding investment offers at valuations of $40 billion or more.
