The Bristol-based startup, which makes chips for AI, raised $150 million in a D2 round at a valuation of $1.95 billion.

Graphcore’s current valuation improves on the $1.7 billion value the chipmaker garnered in December 2018 when it raised $200 million in a D round. The latest funding tops up the firm’s funding to an aggregate $450 million. (EE|Times)

Existing investors who participated in this round included Merian Chrysalis, Ahren Innovation Capital, Amadeus Capital Partners, and Sofina. New investors included Baillie Gifford, Mayfair Equity Partners, and M&G Investments.

Graphcore is the developer of the Intelligence Processing Unit (IPU) and its partner software Poplar, both used for machine learning and AI applications. The firm designed the IPU as the first processor specifically for these purposes.

Financial muscle

Icera co-founder Nigel Toon founded Graphcore in 2016.

After the latest funding, GraphCore is sitting on a cash pile of $300 million. “Having this additional capital on hand allows us to accelerate our investment and allows us to be in a position to support the really large customers who we’re building a business with,” Toon said to Bloomberg.

Growth moves

Graphcore announced it had secured the business of Microsoft (NASDAQ: MSFT), Citadel Securities, Carmot Capital, and Qwant during 2019.

Furthermore, in the same year, it boosted its investment in R&D and nearly doubled its workforce. It expanded existing centers and opened new ones. These were the Beijing, China sales and support center, Cambridge, UK engineering center and Hsinchu, Taiwan operations facility.

Also, the company is confident that its IPU products will become the industry standard for AI computing. “Demand for our Intelligence Processor Unit products is increasing at existing and new customers and the outlook for our business in Fiscal 2020 is extremely positive,” Graphcore said in a statement. “The major investments that we have made during 2018 and 2019 will help us to meet this strong demand by extending the capabilities of our technology and ecosystem, and will support long-term revenue growth and returns for our investors.”

Hot sector

Meanwhile, Intel (NASDAQ: INTC) acquired Graphcore’s rival Israeli firm Habana Labs, in December for $2 billion.

Related Story:  Intel Scoops Up Israeli Artificial Intelligence Firm for $2 Billion