The rise of NVIDIA has renewed investor interest in AI chip startups. One of those companies, Blaize, founded by former Intel engineers, announced on Monday that it plans to go public on the NASDAQ in a SPAC transaction on Tuesday.
Founded in 2011, Blaze has raised $335 million from investors including Samsung and Mercedes-Benz. Headquartered in El Dorado Hills, California, the company focuses on manufacturing AI chips for edge applications. Its chips are intended to be integrated into smart products such as security cameras, drones, and industrial robots, rather than being used primarily in large data centers (like NVIDIA's).
“AI-powered edge computing is the future due to its low power consumption, low latency, cost-effectiveness, and data privacy benefits,” CEO Dinakar Munagala, who previously spent about 12 years at Intel, said in a statement to TechCrunch. mentioned in.
Blaze is currently a small player in the massive AI chip industry, with revenues of just $3.8 million and losses of $87.5 million in 2023, its most recent available financial year, according to its prospectus. It is extremely unprofitable. But chipmakers will need significant capital to build out manufacturing (which Blaze says is happening in the U.S.) before they can begin to scale up in earnest.
“As you can imagine, [as a] Semiconductor companies have huge investments, and when the hockey stick comes out, the stock price goes up,” Munagara told TechCrunch.
Blaze also touts a $400 million deal in the works. One of the company's investor decks talks about a system that can identify unknown or friendly troops, spot small boats, and detect drones from an unnamed EMEA “defense organization, likely in the Middle East.” is facilitating a signed purchase order of up to $104 million with (Munagara declined to say exactly which country.)
Munagala told TechCrunch that he expects Blaize to be worth $1.2 billion after the SPAC merger. That's lower than private valuations for other companies like Cerebras, a high-profile AI chip maker that filed for an IPO last fall and was looking to double its $4 billion valuation, TechCrunch previously reported. However, some investors are concerned about the company's over-reliance on a single customer in the Middle East, and Cerebras has not yet gone public, investors told CNBC.
However, in contrast to Blaize, Cerebras focuses on data center chips. Blaize's initial public offering is a bet on a future where AI chips will eventually be further integrated from centralized data centers into physical products.
“All of the AI hype is happening in data centers. Interestingly, they are bringing very real physical world use cases that are impacting people's lives and are happening right now and making money. We completely ignore and forget about it,” Munagara told TechCrunch. “We are focused on practical applications of AI in the physical world.”