From TechCrunch, July 11:
Terms of the deal were not disclosed, but Graphcore CEO Nigel Toon says it’s a positive outcome (for most). Full regulatory approval has been granted already, meaning this is final.
U.K. chip company Graphcore has been formally acquired by Japan’s SoftBank.
Rumors of the deal have abounded for some time, but protracted negotiations and regulatory approvals have meant neither company has confirmed anything until now. Even today, the company wouldn’t confirm the one thing most people will be wondering: How much does Japanese multinational SoftBank value a startup touted as a potential rival to the mighty Nvidia in the AI chip space?
While the figure of $500 million has been bandied around in various reports for months, in a press briefing early Thursday morning, Graphcore co-founder and CEO Nigel Toon remained coy on the details. “We have agreed with SoftBank that we’re not going into the details of the deal; whether anything comes out in the future, we’ll see,” Toon said.
Toon did say, however, that the $500 million figure was inaccurate. Make of that what you will.
When the chips are down
Founded out of Bristol in 2016, Graphcore has devised a new kind of processor dubbed an “intelligence processing unit” (IPU), distinct to the kinds of graphics processing units (GPU) developed by the likes of Nvidia. While both accelerate computation, IPUs have a different architecture designed from the ground-up for AI workloads. Graphcore pitches its chips as a more efficient alternative to GPUs, with a focus on supporting large-scale parallel processing and executing complex machine learning models, where the model and data are tightly coupled.
Graphcore had raised around $700 million since its inception, reaching a valuation just shy of $3 billion in late 2020. With big-name corporate and institutional investors like Microsoft and Sequoia, and angels such as DeepMind’s Demis Hassabis and OpenAI co-founder Greg Brockman, hopes were high that Graphcore could be an AI beacon in the U.K. or even all of Europe. But AI hardware is a resource-intensive business, and Graphcore ultimately couldn’t hit the giddy heights many had hoped it could reach. It lost out on potential lucrative cloud deals with Microsoft, while the U.K.’s own government ignored Graphcore (despite a public plea from Toon himself) for its new “exascale” computer plans last year.
Graphcore has not had the best of times of late, compounded last year by its forced China exit due to U.S. export rules.
With losses widening and Graphcore approaching four years since its last capital injection, it was increasingly clear that something had to happen somewhere — and an acquisition always seemed the most likely outcome, particularly at a time when demand for AI hardware is at fever pitch.
SoftBank, for its part, is no stranger to U.K. semiconductor companies, having previously acquired Arm for £24 billion ($31 billion) and then retained a stake as it spun Arm out as a $55 billion publicly traded company last year. Arm is now worth close to $200 billion — a sign, perhaps, that SoftBank might not be the worst bedfellow for Graphcore, as the well-financed Japanese powerhouse seeks to bolster its AI aspirations with everything from data centers and robotics, to the semiconductors needed to power the AI revolution....
....MUCH MORE
Chips: "SoftBank Is Said in Talks to Buy Troubled AI Chip Firm Graphcore"
In 2017 it was looking so promising: "Sequoia Backs Graphcore as the Future of Artificial Intelligence Processors" (NVDA; INTC).
