Graphcore was the "Office in Bristol".
A year later: "Sequoia Backs Graphcore as the Future of Artificial Intelligence Processors" (NVDA; INTC):
From Wired, August 27:
Bristol-based Graphcore's "intelligence processing unit" aims to do for AI what the graphics processing unit did for computing
In September 2015, hardware veterans Nigel Toon and Simon Knowles were doing the rounds of venture capital offices in Silicon Valley and London, touting their latest startup. The pair had a dazzling track record – among other achievements they’d sold their previous semiconductor company Icera to NVIDIA for $435 million (£346 million) four years earlier. And their vision for Graphcore – a new Bristol-based venture – was bold: they were building a new generation of microchips known as intelligence processing units (IPUs), designed for the rapidly approaching artificial intelligence age.
Yet early reactions to their pitch for series A financing were distinctly muted. “In many cases we were laughed out of court,” recalls Toon, Graphcore’s CEO.Typically, Toon says, they’d find a partner in a VC firm who was excited by what they were doing. “But then they’d go to their partner meeting, where the first question would be: ‘What’s AI?’ It’s stunning to think that was a conversation that was happening [as recently as] 2015.” From there, it was an uphill struggle. “Even if they got the fact that AI might be interesting, they’d then say: ‘Your business model is to build a chip for this AI thing? Well, nobody’s made money from chip investments in the last 10 years.’”Toon, who is 55 and has the mellifluous voice of an old-school BBC continuity announcer, says that chip development, in the eyes of most investors at the time, was considered highly capital intensive, with returns failing to justify the upfront financing required. “It’s not more capital intensive than software,” says Knowles, Graphcore’s co-founder and CTO. “But software has this joyful property that you can try it out in small scale first, whereas with a chip you’re all in. If it doesn’t work, you’ve spent all your money.”That was 2015. Fast forward to today and, of course, AI hardware is a white-hot category for investors, with VC funding for US AI companies jumping by 72 per cent in 2018 to a record $9.3 billion (£7.4 billion), a fifth straight year of growth, according to a report by CB Insights and PwC.What changed over those three years? Toon points to two things. First, in 2016 traditional chip giant Intel acquired an AI software and hardware startup called Nervana for $350 million (£280 million), raising eyebrows all over the Valley. Second, Google announced it was going to build its own chips – evidence, Toon says, that existing chips weren’t up to the task.Knowles describes the impact of Google’s decision as “seismic”. The fact that Google thought AI was going to be a sufficiently big deal to justify the pain and expense of building its own chip team helped make the Graphcore founders’ case for them. He and Toon had been arguing that it was worth digging deep financially to develop new processor hardware because existing graphics processing units (GPUs) – used, for example, in mobile phones, games consoles and personal computers – weren’t designed for AI workloads such as machine learning and deep learning.By then, their startup was already ahead of the pack in developing a new processor architecture. Soon top-tier investors – including Atomico, one of Europe’s best-known VCs – were beating a path to their door. Atomico, which went on to lead Graphcore’s $30 million (£24 million) Series B round in July 2017, was followed six months later by one of the Valley’s biggest guns, Sequoia Capital. At the time, Graphcore, having recently closed its Series B, didn’t need investment – but the west coast investor wasn't taking "No thanks" for an answer. “They came to see us here in Bristol and said, ‘No, you don’t understand, we want to invest in your business,’” laughs Toon. “So we work out terms and they invest $50m into the company. And that’s one of the very few investments they’ve made in the UK, because they’ve got so much opportunity on their doorstep.”Sequoia partner Matt Miller, who now sits on Graphcore’s board, admits he was somewhat bemused to find himself chasing down a company based in Bristol. “We knew there was an opportunity for a new architecture that would be designed from the ground up that could massively accelerate our entry into this AI age, and we were trying to landscape all of these companies in China, the US and Europe,” he says. “But our references were all pointing to this one company in Bristol, whom we hadn’t met yet.”A roar of laughter distorts the line from the Valley. “Lemme tell you, if you’d asked me a month prior if I’d ever [sit on] a board in Bristol I’d have said ‘No way!’ It’s not your typical destination on your tour of Europe. But to be honest, it’s been surprising for us in the Bay Area because the quality of talent in the UK, and particularly in Bristol in the semiconductor space, is very strong. The team they’ve been able to build there is on a par with the best in the world.”Following a $200 million (£160 million) Series D round in December 2018, Graphcore was most recently valued at $1.7 billion (£1.36 billion), with investors, innovators and large corporates now seemingly convinced it will be the company to power the AI era in much the same way as Cambridge-born chip giant ARM dominated mobile devices, shipping over 130 billion chips and reaching 70 per cent of the global population. The opportunity at stake is nothing less than the future of AI, with applications ranging from medical advances to autonomous vehicles, space exploration and just about everything in between....MUCH MORE
If interested, see also:
Dec. 26, 2018
And many more, use the 'Search blog box if interested