Tenstorrent has raised $1.5 billion at a $6.2 billion valuation, giving the AI chip startup new funding to expand its hardware business. The company plans to use the capital to scale chips built for serving open-weight AI models and video generation.
A larger valuation and a new funding round
The new valuation is more than double the $2.6 billion Tenstorrent fetched in late 2024. The round was led by Trace Capital, a new firm launched by Quiet Capital co-founder Ben Mahdavi, and Innovation X.
Other investors in the round included Cadence Ventures, Eclipse, Fidelity, SanDisk, and T. Rowe Price. The funding follows reported acquisition interest from Intel and Qualcomm, which had considered valuations of as much as $5 billion.
Tenstorrent is a 10-year-old company focused on chips for inference, the process of running trained AI models to generate results. Its fundraising signals that the company intends to build its own business rather than sell to a larger chipmaker.
Why Tenstorrent chose to stay independent
CEO Jim Keller told Bloomberg that the company decided to remain independent and raise more capital after demonstrating that its Galaxy servers could run DeepSeek models. That result gave the company a basis for pursuing additional investment and expanding its product plans.
The decision leaves Tenstorrent with more resources to develop and scale its chips. Its stated focus is serving open-weight AI models, whose weights are available for users or developers to work with, along with video generation. Those are the areas the company says its new funding will support.
Competing in AI hardware
Tenstorrent is among a group of AI hardware startups looking to challenge Nvidia’s dominance. The company’s plans center on chips and servers that can run AI models, while its funding provides capital to pursue that work at greater scale.
The fundraising also comes amid investor attention to other companies in the sector. Etched, another AI chip maker, was fielding investment offers at valuations of $40 billion or more, according to TechCrunch earlier this month. That comparison points to the high expectations surrounding AI hardware, though each company has its own products and plans.
What the funding is meant to support
Tenstorrent has said the capital will go toward scaling chips tailored to open-weight AI models and video generation. The source does not specify a timetable for that expansion or describe particular products beyond the Galaxy servers that ran DeepSeek models.
For now, the company’s next step is to turn its technical demonstration and new funding into a larger chip business. Its independence gives it room to pursue that strategy, while its position among AI hardware startups places it in a market where Nvidia remains dominant.