UK AI Chipmaker Graphcore Finds a Lifeline in SoftBank
In a significant move within the artificial intelligence (AI) industry, Japan’s SoftBank Group Corp acquired Graphcore, a UK-based AI chipmaker. The acquisition, confirmed on 11th July 2024, marks a pivotal moment for both companies as they aim to reshape the landscape of AI technology.
Graphcore, known for its innovative Intelligence Processing Units (IPUs), has faced considerable challenges in recent years. Despite securing substantial investments totalling $700 million from notable backers such as Microsoft and Sequoia Capital and achieving a peak valuation of $2.8 billion in late 2020, the company struggled to maintain its competitive edge. This struggle led to significant downsizing, including laying off 20% of its workforce and closing operations in several countries, leaving it with approximately 500 employees.
Nigel Toon’s Optimism for the Future
Nigel Toon, Graphcore’sCEO, expressed optimism about the acquisition, stating, “This is a tremendous endorsement of our team and their ability to build truly transformative AI technologies at scale, as well as a great outcome for our company.” Toon highlighted the growing demand for AI computing, emphasising the need for improved efficiency, resilience, and computational power to unlock AI’s full potential. He noted that partnering with SoftBank provides the necessary support to redefine AI technology’s landscape.
SoftBank, renowned for its substantial investments in AI, plans to bolster Graphcore’s capabilities, enabling it to compete globally. Vikas J. Parekh, Managing Partner at SoftBank Investment Advisers, remarked, “Next-generation semiconductors and computing systems are essential in the AGI journey. We’re pleased to collaborate with Graphcore in this mission.” This collaboration aims to harness Graphcore’s potential in advancing foundation models, generative AI applications, and scientific discovery.
Integration and Potential Collaboration with Arm
Despite retaining its name and operational independence, Graphcore’s integration into SoftBank’s ecosystem is expected to bring strategic advantages. There is potential for collaboration with Arm, another UK-based chip designer owned by SoftBank. Nigel Toon anticipated working with all companies under the SoftBank umbrella, including Arm, who reportedly developed AI processors for SoftBank’s data centres.
The terms of the acquisition remain undisclosed, though estimates suggest a purchase price between $400 million and $500 million. This valuation underscores Graphcore’s challenging market conditions. Nonetheless, SoftBank’s financial backing is anticipated to provide the stability and resources needed for Graphcore to pursue its technological ambitions.
Graphcore’s Technological Prowess: The Colossus MK2 IPU
Built with the Colossus MK2 IPU, @graphcoreai's new IPU-M2000 delivers 1 PetaFlop of #AI compute & up to 450GB Exchange-Memory™, while our IPU-POD64 offers up to 64,000 IPUs' worth of seamless scale-out.
Graphcore’s flagship product, the Colossus MK2 IPU, exemplifies its cutting-edge capabilities. The MK2 IPU boasts 59.4 billion transistors, 1,472 independent cores, and the ability to handle 8,832 parallel threads, delivering impressive computational performance. Its innovative architecture and integrated memory provide substantial bandwidth, positioning it as a formidable competitor in the AI processor market.
The acquisition signifies a fresh start for Graphcore, aligning with SoftBank’s broader AI strategy. SoftBank has demonstrated a robust commitment to AI, evidenced by its recent partnership with Perplexity, a generative AI search startup, and its plans to invest nearly USD 9 billion annually in AI ventures. These initiatives highlight SoftBank’s vision to enhance its capabilities and fortify its primary asset, Arm.
Conclusion: Redefining AI Technology’s Landscape
In conclusion, Graphcore’s acquisition by SoftBank marks a significant step in the evolution of AI computing. This partnership aims to leverage Graphcore’s technological prowess and SoftBank’s financial strength, fostering advancements in AI that could redefine the industry’s future. As Nigel Toon aptly summarised, “In SoftBank, we have a partner that can enable the Graphcore team to redefine the landscape for AI technology.” The collaboration promises to unlock new potentials, driving the frontier of artificial intelligence.
