Graphcore Considering New Funding Round Prior to Potential IPO

(Bloomberg) -- U.K. semiconductor designer Graphcore is considering a new funding round, prior to a potential initial public offering.

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Significant interest from investors prompted the consideration, said Nigel Toon, Graphcore’s Chief Executive Officer, at Morgan Stanley’s TMT Conference on Wednesday, adding that there are no “firm plans” for a fund raise.

The Bristol-based startup, whose chip designs are used in artificial intelligence applications, still has a cash pile of $350 million, he added.

Graphcore was valued at $2.77 billion in December when it raised $222 million from investors including the Ontario Teachers’ Pension Plan Board, Fidelity International and Schroders Plc.

In an interview at the time, Toon said it could be Graphcore’s last fundraising round as a private company ahead of a potential initial public offering at some point after 2021.

Graphcore competes with larger chipmakers including Nvidia Corp., which is currently struggling to close its deal for Arm Ltd, which is facing a national security review in the U.K.

Toon said on Wednesday that the potential merger would “put too much power in the hands of Nvidia.”

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