Tenstorrent said on Monday that it has closed a $1.5 billion Series E funding round at a $6.2 billion post-money valuation, more than doubling the valuation it carried out of its previous raise in December 2024. The Santa Clara, California-based AI chip startup is now one of the best-funded challengers trying to build an alternative to the proprietary hardware stacks that dominate AI data centers.
The round was led by Trace Capital and Innovation X. Other backers included ARK Invest, Fidelity Management & Research Company, Morgan Stanley, T. Rowe Price, Sandisk, Tether Investments, Cadence Ventures, Eclipse, Protagonist, Maverick Silicon, Virtu Financial and XTX Markets, according to the company.
Tenstorrent said it will use the capital to deploy its Galaxy servers at scale, continue serving open-weight models across large language models and video generation, and advance the AI and CPU intellectual property it licenses to customers designing their own silicon. Its Galaxy servers combine dozens of its AI chips in a single system, aimed at applications including chatbots, coding assistants and video generators.
The company's pitch is openness. Tenstorrent develops AI chips and software using RISC-V, the open-source chip architecture that lets companies design processors without paying license fees and reduces dependence on proprietary ecosystems such as Arm's. It sells AI compute at every level of the stack, from a single card or workstation to racks, superclusters and custom IP, and pairs the hardware with an open-source software stack that lets developers run frontier models locally and enterprises deploy models on premises.
"We built one architecture and sell it at every size," said CEO Jim Keller. "The future of compute is open, scalable, and owned by the people building on it. Our investors believe in that model too, and we appreciate their support." Trace Capital founder Ben Mahdavi said Keller and his team bring decades of hands-on silicon, software and IP experience, and that the firm is excited to partner with Tenstorrent as Galaxy continues to scale.
Keller is a central part of the company's credibility. The prominent chip architect previously led Tesla's efforts to develop a self-driving chip for electric vehicles and held key design roles at Apple and AMD, work that included Apple's early A-series processors and AMD's Zen architecture. Tenstorrent licenses its RISC-V CPU and AI core IP to chip designers including Samsung and LG.
The new round is a sharp step up from the startup's last financing, which raised more than $693 million in December 2024 at a $2 billion pre-money valuation, in a round led by Samsung Securities and AFW Partners.
The size of the raise also underlines how much capital it now takes to compete in AI infrastructure. The funding arrived on a day when chip stocks were rebounding after a bruising selloff driven by questions about the sustainability of AI spending, a reminder that investors are still willing to commit very large sums to companies they believe can take a share of that spending. For Tenstorrent, the next test is execution: turning a much larger balance sheet into Galaxy systems shipped in volume, and into licensing and on-premises deployments that give customers a practical reason to build outside the incumbent ecosystems.