AI startup General Compute has secured a $400 million loan from investment firm Upper90 to build an AI inference cloud using chips from SambaNova. The deal, which uses the chips as collateral, signals a market shift toward cheaper, open-source AI infrastructure and reflects growing investor interest in financing alternatives to Nvidia's dominant hardware ecosystem.
General Compute funding deal
- ▪In May, General Compute raised a $15 million seed round to build its inference neocloud
- ▪General Compute, an AI inference cloud startup, has secured a $400 million loan from tech investment firm Upper90
- ▪The loan to General Compute is collateralized by inference-specific chips
Inference chip technology
- ▪Inference chips are designed to run pre-trained AI models, in contrast to more expensive chips used for AI model training
- ▪General Compute is building its infrastructure using SN50 chips from SambaNova, an Intel-backed chipmaker
- ▪SambaNova's SN50 chips are power-efficient and do not require expensive water-cooling systems, allowing for faster deployment
Chips-backed financing model
- ▪Upper90's co-founder and CEO is Billy Libby, a former quantitative trader at Goldman Sachs
- ▪The model of using chips as collateral for loans became more common after its use by the company CoreWeave
- ▪In 2021, Upper90 pioneered loans against advanced chips by financing GPU purchases for the startup Crusoe
Open-source AI infrastructure trend
- ▪Companies providing access to open-source models, such as OpenRouter and Fireworks, have recently raised significant new funding
- ▪The deal reflects a market shift toward infrastructure that runs open-source AI models more cheaply than proprietary large language models
- ▪New open-source models like Kimi's K3 have demonstrated performance competitive with models from Anthropic and OpenAI on certain benchmarks
Nvidia alternatives market
- ▪Other AI infrastructure companies like TensorWave are also building on non-Nvidia hardware, partnering with chipmakers like AMD
- ▪The deal is positioned as a move to challenge Nvidia's dominance in the AI chip market
- ▪Chipmakers such as Groq and Cerebras are also gaining interest from acquirers and public markets as alternatives to Nvidia
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