In today’s newsletter:

• News - 🚀 Amazon Unveils Supercomputer Powered by Homegrown AI Chips

• Culture - 📊 AI Investment Trends: The Charts Say It All!

🚀 Amazon Unveils Supercomputer Powered by Homegrown AI Chips

Amazon's Annapurna Labs is rewriting the playbook on AI chip design, focusing on a holistic approach where chips, boards, servers, and racks are developed simultaneously. This fast-paced strategy has fueled innovations like AWS’s Trainium chips, which offer businesses cost-effective alternatives to Nvidia's GPUs. For instance, Trainium2 boasts price savings of up to 50% for companies like Apple and Poolside, though the trade-off is that engineers might spend extra time configuring Amazon's software. Still, with its custom silicon fabricated by TSMC and backed by Amazon’s robust infrastructure, Trainium has become a reliable option for AI workloads.

Despite Trainium’s potential, AWS knows Nvidia remains the dominant player, powering 99% of today’s AI workloads. Yet, Amazon aims to carve out its niche with innovations like the Trainium-based Ultraserver, which links 64 chips into a powerhouse system with 83.2 petaflops of compute. These custom chips are also seamlessly integrated into AWS’s Bedrock platform, making advanced AI accessible without businesses worrying about the hardware under the hood. While Nvidia might continue to lead, AWS is positioning itself as the go-to for scalable, cost-effective solutions in the growing AI market.

🗞️ In Other News…

• Meta announced that AI-generated content accounted for less than 1% of election misinformation on its platforms, attributing this to strict content moderation and the elimination of covert influence operations while highlighting rivals like X and Telegram for hosting similar activity.

• The AI chip market is heating up as companies like AMD and Amazon introduce powerful, cost-effective alternatives like MI300 and Trainium 2, challenging Nvidia’s dominance in tasks like inferencing while prioritizing price-performance and scalability for end users.

• AWS announced significant data center innovations, including liquid cooling for AI servers, simplified electrical designs to boost energy efficiency and reliability, and AI-driven rack positioning to optimize power use, all aimed at supporting advanced AI workloads and reducing carbon footprints.

• Jeff Bezos has invested in Tenstorrent, an AI chipmaker using open-source technology to challenge Nvidia by offering more affordable, accessible solutions for smaller companies.

• Intel CEO Pat Gelsinger has stepped down as the company struggles to compete in the AI-driven chip market, falling far behind rival Nvidia, whose AI-optimized GPUs have skyrocketed in demand and valuation, leaving Intel facing a critical restructuring amid declining investor confidence.

📊 AI Investment Trends: The Charts Say It All!

AI investing is entering a new chapter, as highlighted by PitchBook's Q3 AI and ML report, showing resilience in foundation model deal value, which has risen unexpectedly in 2024. According to analyst Brendan Burke, enterprise generative AI is moving past the hype into a "plateau of productivity," with businesses finding real value in the technology, akin to the early days of cloud computing. While the market may not live up to sky-high expectations of universal disruption, it’s proving its worth in practical applications, solidifying AI’s long-term place in enterprise solutions.

That said, challenges remain, especially for AI companies seeking exits. With buyouts sparse and acquisitions slowing, IPOs are the most promising yet difficult path forward, hinging on whether the IPO market rebounds next year. Late-stage deal value is also at a four-year low, reflecting the struggles of pre-generative AI boom companies to adapt as technology outpaces their initial visions. As the AI landscape evolves, it's clear the journey is far from over, with plenty of twists and turns still ahead.

VC Fundraising Rounds

• Yurts, a leader in secure and trusted generative AI integration at scale for defense, government, and enterprise customers, announced a $40 million Series B funding round. (12/3/24)

• Tenstorrent, an AI chip and IP startup, raised $693 million in an oversubscribed Series D round at a $2 billion pre-money valuation. (12/2/24)

• 9fin, a London-based company, has secured $50 million in a Series B funding round to advance its AI-powered analytics platform for global debt capital markets. (12/2/24)

• Radium, a company that augments GPT to tackle the complexity of precision medicine, has raised €16M in its seed round. (11/28/2024)

• FiVerity, dedicated to creating solutions for cyber fraud detection in financial institutions, has raised $8.5M in its funding round. (11/27/2024)

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