SoftBank Group of Japan has acquired Graphcore, a British artificial intelligence chipmaker, in a deal whose financial details were not disclosed, bringing an end to speculations about Graphcore’s future.
Initially positioned as a competitor to Nvidia, whose market value has surged amid high demand for AI chips, Graphcore struggled to secure necessary investments for competitive footing. By the end of 2020, it was valued at $2.77 billion. Last year, a filing indicated Graphcore required additional funding to achieve profitability, following a 20% reduction in its workforce to 494 employees and closure of operations in Norway, Japan, and South Korea.
Nigel Toon, co-founder and CEO of Graphcore, acknowledged the company’s challenges and highlighted the transformative potential of the SoftBank deal. Toon noted surprise at the speed and scale of the acquisition, emphasizing the substantial investment involved. Despite Graphcore’s smaller size relative to competitors, Toon emphasized the company’s success in developing world-class technology.
Toon, remaining in his current role, declined to disclose the acquisition price by SoftBank. Reflecting on the British tech sector, Toon pointed to historical reluctance among UK pension funds to invest in fast-growing startups, posing barriers to industry expansion. Regarding potential collaboration with Arm Holdings, another SoftBank-owned leader in chip design, Toon affirmed Graphcore’s intention to leverage synergies within SoftBank’s portfolio of companies.
