In recent years, Nvidia, by far the largest AI chip maker, has increased its investments in startups that push it deeper into the AI space. According to S&P Global and Crunchbase, the funding and investment database, Nvidia’s seed investments increased 280% year over year from 2022 to 2023, with the company and its venture capital arm, Nvidia Ventures, participating in ~46 agreements last year.
It’s not the only one. Nvidia’s main rivals in the AI chip space (AMD, Arm and Intel) have also been investing aggressively in startups, seeking to regain ground in markets including the especially frothy generative AI segment.
At TechCrunch we were curious to see how investments stacked up among the major AI chip makers: Nvidia, AMD, Arm, and Intel. So we pored over Crunchbase data, looking at the recent activity of each chipmaker and their venture capital arms.
Intel
Of Nvidia’s competitors, Intel has by far the largest seed investment deal thanks to Intel Capital, its long-standing VC. In 2023, Intel Capital deployed more than $350 million across its investments, including OpenAI rival AI21 Labs, threat hunting platform Twelve Labs, application delivery network Fly.io, and the security team at the TuMeke workplace.
Crunchbase data is not exhaustive. But it shows that Intel Capital was involved in 32 startup deals in 2023, up from 47 in 2022. Intel also invested directly in four startups last year (GenAI provider Aleph Alpha and Hugging Face among them) and one (Vanguard Semiconductor) in 2022, by Crunchbase: bringing the total deals to 36 in 2023 and 48 in 2022.
Interestingly, AI startups (despite their strategic importance to the chip industry these days) make up a relatively small portion of Intel’s portfolio of companies. According to Crunchbase, Intel’s holdings in software, IT, and enterprise SaaS companies far exceed its holdings in AI startups by transaction volume.
That could change as Intel looks to offer new software products and services, including GenAI-powered products, that make its hardware more attractive for a variety of AI applications. Just in January, Intel created a company, Articul8 AI, to create GenAI solutions running on Intel chips for companies in the aerospace, financial services, telecommunications, and semiconductor industries.
Arm
Arm may not be a particularly active emerging investor compared to Intel. But the company, which makes most of its money by licensing chipsets it designs for its customers, has several direct investment deals, as well as deals through Deeptech Labs, a venture capital and accelerator fund that Arm co-launched. with the University of Cambridge, Cambridge Innovation Capital and Martlet Capital.
Last year, Arm made four direct investments in startups (microprocessor company SiPearl, eSIM security company Kigen and Raspberry Pi, and the Raspberry Pi Foundation) and six investments through Deeptech Labs. Recipients of Deeptech Labs cash They included Nu Quantum, a quantum networking startup; RoboK, which is developing 3D sensing technology; and Perceptual Robotics, a provider of automated wind turbine inspection technology.
So in total, Arm invested money in 10 startups in 2023. That’s a significant rebound from 2022, when Arm invested in just four companies: a direct investment in open source hardware startup Arduino and three investments through from Deeptech Labs (Waku Robotics, Xapien and SonicEdge).
Arm’s future investments are expected to focus on AI in a more obvious way, as the company bets that sales of both its data center and consumer AI chips will rise sharply this year.
amd
Like Intel and Arm, AMD invests in startups both directly and through a venture capital organization, AMD Ventures. But for AMD, deals are rare.
Last year, AMD Ventures made a single investment and participated in the Series A of Ethernovia, a startup creating a family of Ethernet chips and software. The year before, AMD Ventures invested in Radian Arc, an infrastructure-as-a-service platform for cloud gaming and artificial intelligence, and no other company.
AMD’s direct deals outnumbered its corporate venture capital deals, unusually, at least in 2023. That year, AMD invested in Essential AI, which seeks to pioneer AI-powered software automation technology; Moreh, a company that creates tools to optimize AI models; and Hugging Face (along with Intel and Nvidia).
Taking direct investments into account, AMD’s total deals in 2023 amounted to four, on the conservative side compared to its rivals. But the year 2024 may look a little different. When contacted for comment, AMD shared the following from Mathew Hein, the company’s director of corporate development strategy:
AMD Ventures has ramped up its investment activity last year and is looking to accelerate further in 2024, with the goal of reaching a double-digit investment level. We invest at all stages, supporting promising startups poised to become market leaders, as well as mature, later-stage companies. The majority of our new investments in 2024 will be directed to the AI ecosystem, including AI platforms, generative model companies, and AI infrastructure offerings.
2024 will be a pivotal year for AMD in other ways. The company is ramping up production of its MI300 AI chip, which is designed to handle AI workloads in data centers, and launching Ryzen 8040, its AI-accelerated mobile processors aimed at laptops.
By the numbers
So it’s true: Nvidia isn’t the only chipmaker investing in its early companies. But does They seem to be outperforming the competition. In the first three quarters of 2023 alone, Nvidia funneled nearly $1 billion to “unaffiliated” companies, according to S&P Global’s previous report, a figure that even Intel Capital struggled to match.
Success in the AI chip manufacturing space doesn’t necessarily mean fostering a strong startup ecosystem. But it’s clear that Nvidia, one of the most valuable companies in the world with control of about 95% of the AI chip market, is playing for its own good, trying to shore up dominance by spreading its financial influence far and wide.
I would say that their rivals have a lot of work ahead of them.
