Tenstorrent Raises $1.5 Billion at $6.2 Billion Valuation

By Amara Osei

Tenstorrent has raised $1.5 billion at a $6.2 billion valuation, more than doubling the chip startup's worth from the $2.6 billion it fetched in late 2024. The round lands just five months after the 10-year-old Nvidia challenger reportedly drew acquisition interest from Intel and Qualcomm at valuations of as much as $5 billion.

The company chose cash over a buyout. Jim Keller, the prominent microprocessor engineer who serves as Tenstorrent's CEO, told Bloomberg the company decided to remain independent and raise more capital after it demonstrated that its Galaxy servers could run DeepSeek models.

Who put up the $1.5 billion?

Trace Capital led the round alongside Innovation X. Trace is a new firm launched by Ben Mahdavi, co-founder of Quiet Capital — a notable debut ticket for a first-time fund.

The backing didn't stop there. The round also drew:

• Cadence Ventures
• Eclipse
• Fidelity
• SanDisk
• T. Rowe Price

That mix pairs semiconductor insiders such as Cadence and SanDisk with mainstream asset managers — a signal that Tenstorrent's pitch reaches beyond the specialist chip crowd.

What will the money fund?

The new capital will go toward scaling chips tailored for serving open-weight AI models and video generation. Tenstorrent has positioned itself as an inference-focused startup, building hardware to run AI models rather than to train them.

The Galaxy server result matters here. Running DeepSeek models — a family of open-weight AI systems — on its own hardware gave Tenstorrent proof that its silicon can serve exactly the workloads it wants to monetize. That demonstration, per Keller's account to Bloomberg, is what tipped the company toward independence and a bigger raise rather than a sale.

Why $6.2 billion now?

The valuation math moved fast. Tenstorrent was worth $2.6 billion in late 2024, drew takeover interest reportedly valuing it at up to $5 billion roughly five months ago, and has now closed at $6.2 billion — a jump of roughly 138% from its previous mark.

The premium suggests investors priced in the acquisition interest as a floor, not a ceiling. Intel and Qualcomm, both reported suitors, would have paid as much as $5 billion to own the company; the market has now valued it higher on a standalone basis.

Can anyone dent Nvidia's grip?

Tenstorrent is part of a wave of AI hardware startups trying to chip away at Nvidia's dominance. The cohort is attracting serious money. Etched, an AI chip maker, was fielding investment offers at valuations of $40 billion or more, TechCrunch reported earlier this month.

The spread tells its own story. One startup in the anti-Nvidia pack is commanding offers above $40 billion; another just closed at $6.2 billion with Fidelity and T. Rowe Price on the cap table. Capital is racing into inference hardware, and it's pricing startups at multiples that make last year's marks look dated.

What comes next?

Tenstorrent now has $1.5 billion to scale silicon for open-weight model serving and video generation — two of the fastest-growing inference workloads. Whether Galaxy-class systems can convert DeepSeek demonstrations into volume deployments against Nvidia's entrenched position will decide if that $6.2 billion valuation was conservative.

-- Amara Osei covers semiconductors and AI infrastructure for Business Bearings.