Jeff Bezos backs Tenstorrent, an AI chipmaker developing GPU alternatives, valuing the company at $2.6 billion

Amazon.com Inc. founder Jeff Bezos has joined Samsung in a $700 million investment in Tenstorrent, an AI chip startup, valuing the company at approximately $2.6 billion. The funding round was led by South Korea's AFW Partners and Samsung Securities, with additional investors including LG Electronics Inc., Fidelity, Export Development Canada, Healthcare of Ontario Pension Plan, Hyundai Motor Group, and Baillie Gifford. Tenstorrent, founded by semiconductor pioneer Jim Keller—known for his silicon design work at Apple Inc., Tesla Inc., and AMD—aims to challenge Nvidia Corp.'s dominance in the artificial intelligence chip market. The capital will be used to expand Tenstorrent's engineering team, strengthen its global supply chain, and build large artificial intelligence training servers to demonstrate its technology.

Tenstorrent's strategy differs fundamentally from Nvidia's approach. The company, located in Santa Clara, California, as an Nvidia neighbor, prioritizes affordability and interoperability by using open-source technology and avoiding costly components like the high-bandwidth memory that Nvidia favors. According to Keller, "You can't beat Nvidia if you use HBM, because Nvidia buys the most HBM and has a cost advantage. But they'll never be able to bring the price down the way HBM is built into their products and their sockets." The company is also championing RISC-V, an open-source processor standard that poses a challenge to Arm Holdings Plc. Keller stated, "In the past, I worked with proprietary tech and it was really tough. Open source helps you build a bigger platform. It attracts engineers. And yes, it's a little bit of a passion project."

While Tenstorrent has made progress, it remains far behind Nvidia in scale. The company has signed customer contracts totaling nearly $150 million, which pales in comparison to Nvidia's tens of billions of dollars in datacenter revenue each quarter. Tenstorrent plans to release new AI processors every two years, whereas Nvidia intends to refresh its offerings annually, with CEO Jensen Huang stating this timeline in June. Tenstorrent's initial chips were manufactured by GlobalFoundries Inc., with future iterations coming from Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. The company is already designing for cutting-edge 2-nanometer fabrication, with TSMC and Samsung set to commence mass production at that scale next year. Tenstorrent is also in discussions with Japan's Rapidus, which aims to achieve 2-nanometer output in 2027.