May 27, 2024

Confidence In Tenstorrent Spurs $100M AI Funding From Hyundai, Samsung

Scrappy AI chip and technologies startup Tenstorrent announced today that it has secured another major $100M round of funding from new marquee partners Hyundai Motor Group and Samsung Catalyst Fund. Lead by acclaimed Silicon Valley chip architect Jim Keller as its CEO, Tenstorrent already has a proven track record of not only general purpose AI processor designs based on the open source RISC-V architecture, but also highly-tuned, bespoke AI chips and board level accelerators. Tenstorrent also offers cloud services based on its technologies and has a vibrant core design licensing business.

Artificial Intelligence is a new hotbed of opportunity, and along with this new market comes a requirement for a very different set of silicon and software solutions to accelerate and process specialized AI workloads. It’s in this burgeoning field that Tenstorrent hopes to disrupt the silicon landscape with more flexible chip architectures not based on either of the legacy X86 or Arm instruction sets and ecosystems, but instead on the open standard RISC-V instruction set architecture that’s available royalty free and open source.

Hyundai Motor Group And Samsung Catalyst Fund Partner With Tenstorrent

An important distinction with this round of funding for Tenstorrent, which is the seventh in the company’s history thus far, is that it comes from partner stakeholders Hyundai and Samsung, rather than the traditional venture capital space. “The trust in Tenstorrent shown by Hyundai Motor Group and Samsung Catalyst Fund leading our round is truly humbling,” notes Jim Keller, CEO of Tenstorrent. “It has been impressive watching Hyundai Motor Group become the third largest automaker in the world through their aggressive adoption of technology including their acquisition of Boston Dynamics, their joint venture with Aptiv, and now their investment in us.”

Another leading indicator on Tenstorrent’s initial success and early traction, would be its expanding IP licensing revenue stream, which sources inside the company say could easily float Tenstorrent’s business model on its own. However, that business model is your basic “right tool for the job” approach, meaning if a potential customer like Hyundai Motor Group could be better served licensing Tenstorrent custom IP and building their own chips, that option is on the table, along with an offering of proprietary Tenstorrent chips and board-level products as well. “Tenstorrent’s high growth potential and high-performance AI semiconductors will help the Group secure competitive technologies for future mobilities,” said Heung-soo Kim, Executive Vice President and Head of the Global Strategy Office (GSO) at Hyundai Motor Group. “With this investment, the Group expects to develop optimized but differentiated semiconductor technology that will aid future mobilities and strengthen internal capabilities in AI technology development.”

Further, with respect to its contribution to this round of financing, Marco Chisari EVP of Samsung Electronics, Head of Samsung Semiconductor Innovation Center offered, “Samsung Catalyst Fund invests in disruptive ideas that we believe can change the world… Tenstorrent’s industry-leading technology, executive leadership, and aggressive roadmap motivated us to co-lead this funding round. We are excited by the opportunity to work with Tenstorrent to accelerate AI and compute innovations.”

Partners Double-Down On Their AI Investments

What’s perhaps most interesting for me with respect to Tenstorrent’s joint announcements today, is the confidence factor associated with the dynamics of these new partnerships. My business partner, Marco Chiappetta and I had a chance to sit down with Tenstorrent VP of Operations, Jennifer Crow, who has an impressive track record of tenure herself, hailing from previous posts at Intel and AMD. She offered us interesting insight into how this level of funding came to be.

Crow recounted a meeting with Hyundai Motor Group, in-which this prospective partner visited for an all-day, technical deep dive face-to-face with Tenstorrent engineering. Initially the goal was to bring Hyundai’s investment in at around $10 million, but after that day-long session with the group, Hyundai increased their investment position 5X, putting up $50 million combined between Hyundai and Kia instead. Crow feels these new key partners are investing not only in Tenstorrent technology and innovation, but their leadership team as well, citing that beyond Jim Keller’s chip rockstar status, Tenstorrent COO, Keith Witek is a “compelling, strategic energizer bunny,” for example.

Tenstorrent’s Opportunity And The Road Ahead

There’s little question Tenstorrent faces stiff competition in a market where chip juggernauts like NVIDIA, AMD and Intel are all squarely focused on AI innovation and acceleration, with NVIDIA serving as the proverbial 800 lb gorilla to beat in the data center. That said, market dynamics with respect to AI and silicon solutions have also changed dramatically, with the move toward more and more custom and semi-custom, bespoke chip designs that are optimized for specific customer workloads.

Further, with Arm recently raising its licensing fees, potential customers have reportedly been streaming in to investigate Tenstorrent’s IP solutions that are based on the open source RISC-V instruction set and architecture.

And so it seems there’s perhaps a new, more level and open playing field with respect to AI acceleration solutions in the market, and key partners like LG, Hyundai Motor Group and Samsung Catalyst Fund obviously feel Tenstorrent and its leadership are an innovative bet worth making.

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