Exclusive-AI chip startup d-Matrix raises $110 million with backing from Microsoft
Reuters
Published Sep 06, 2023 06:12AM ET
By Max A. Cherney
(Reuters) - Silicon Valley-based artificial intelligence chip startup d-Matrix has raised $110 million from investors that include Microsoft Corp (NASDAQ:MSFT) at a time when many chip companies are struggling to raise cash.
Nvidia (NASDAQ:NVDA)'s dominant position in the AI chip market due to a powerful combination of hardware and software has scared off potential investors in some startups, according to sources Reuters interviewed. Nvidia declined to comment.
The Series B funding round was led by the Singapore-based Temasek, and included the Palo Alto, California venture firm Playground Global and Microsoft.
"This is capital that understands what it takes to build a semiconductor business," CEO Sid Sheth told Reuters. "They've done it in the past. This is capital that can stay with us for the long term."
The Santa Clara company started its fundraising process roughly a year ago, Sheth said. The company did not disclose the valuation, and it has previously raised $44 million.
D-Matrix designs chips that are optimized to help power generative AI applications such as ChatGPT. The company designs the chips with digital "in-memory compute" that enables AI computer code to run more efficiently. The company's chip technology uses less energy to crunch data required to spit out generative AI responses, and is optimized for such tasks.
D-Matrix sets itself apart from Nvidia, in part, because its technology aims at the "inference" portion of AI processing, and does not compete with Nvidia by making technology that trains large AI models.
"We have solved the computer architecture," Playground partner Sasha Ostojic said. "We have solved the low power requirements and the needs of a data center - (we) built a software stack to deliver the lowest latency in the industry by orders of magnitude."
Microsoft has committed to evaluating the chip for its own use when it launches next year, Sheth told Reuters.
D-Matrix projects that it will receive under $10 million in revenue this year - largely from customers purchasing chips to evaluate. The business expects to generate more than $70 million to $75 million in annual revenue in two years, and break even, Sheth said.
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Written By: Reuters
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