British chipmaker Graphcore has been snapped up by Softbank as the Japanese investment firm accelerates its push into artificial intelligence.
Once talked up as a potential rival to Nvidia, Graphcore has struggled to secure the investment needed to compete in recent years and was forced to slash its headcount last year and scale back its operations in Norway, Japan and South Korea.
However, speaking at a media briefing on Thursday, cofounder and CEO Nigel Toon said the Softbank deal now “marked a level of investment that is utterly massive” for the company.
“Graphcore, as a modestly-sized company compared to those we’re competing with, has actually managed to go toe-to-toe and build world-class technology,” he added.
Toon, who will stay on in his role, declined to comment when asked how much Softbank had paid for the company.
The deal will end speculation over the company’s future, after it revealed last year that it needed more cash to break even.
Reflecting on the state of the British tech industry, Toon criticised a lack of investment from British pension funds yesterday and said the firm had been forced to look overseas to raise cash.
“There’s a massive opportunity here, but there’s a lot of structural things that still need to be fixed,” he said.
“If you look at where our money came from, some of it came from the UK, but the majority of it came from other regions. That’s the reality of it, and that’s the piece that we’re going to need to fix, going forward.”
The deal comes as Softbank ramps up its push into AI and pivots away from its traditional venture capital model of investing.
Softbank became known globally for its flagship Vision Fund, investing in pie in the sky companies which occasionally translated to a massive win.
The firm, run by Masayoshi Son, has earmarked about $9bn (£7.6bn) to invest in AI.