OpenAI CEO Sam Altman Discusses New Chip Venture with Middle East Investors and TSMC
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OpenAI CEO Sam Altman is in discussions with Middle East investors and chip manufacturer TSMC to launch a new chip venture. According to informed sources, this is aimed at meeting the company's growing demand for semiconductors while reducing reliance on NVIDIA. Altman has been discussing funding for this ambitious new project with some of the wealthiest investors in the region to develop the chips needed for training and building AI models, as well as the factories required to manufacture these chips.
The 38-year-old entrepreneur is negotiating with investors in the United Arab Emirates, including one of Abu Dhabi's wealthiest and most influential figures, Sheikh Tahnoon bin Zayed al-Nahyan, to fund this venture.
He is also in discussions with TSMC regarding cooperation on chip manufacturing.
OpenAI and TSMC declined to comment on this matter. Sheikh Tahnoon could not be immediately reached for comment. Bloomberg first reported the news of Altman's negotiations with Middle Eastern investors regarding the chip collaboration. Sheikh Tahnoon is one of the most powerful figures in the UAE. He is the brother of the Gulf state's President, Sheikh Mohammed bin Zayed al-Nahyan, and serves as the National Security Advisor. He also oversees a rapidly expanding business empire and chairs Abu Dhabi's most influential sovereign wealth fund.
These include the $800 billion Abu Dhabi Investment Authority and ADQ, another state investment entity. He also chairs International Holding Company, a sprawling conglomerate that has rapidly become the UAE's largest listed company, as well as the ambitious AI firm G42, which has partnerships with Microsoft and OpenAI.
It remains unclear how much Altman is seeking to raise for his new venture, but designing and developing chips is an extremely costly endeavor. Competing with Nvidia, which has a market cap of nearly $1.5 trillion, could require billions of dollars. Chips have become the hottest commodity for Silicon Valley startups and established tech companies in other regions over the past year, granting a few leading chip manufacturers the role of 'kingmakers' in the race for AI supremacy.
Increasingly powerful semiconductors, particularly NVIDIA's Graphics Processing Units (GPUs), have become the cornerstone of the AI revolution.
OpenAI and other leading companies rely on thousands of chips to train and run their large language models, making the competition for GPUs extremely fierce. The supply of semiconductors is tightly controlled by a handful of major companies. OpenAI is developing a new version of its AI model, expected to launch this year, which will be a major upgrade to its latest product GPT-4. Each model upgrade makes the company more dependent on its partners' chips.
It remains unclear whether Altman's chip venture will be managed as a subsidiary of OpenAI or as an independent entity. According to two people familiar with the plans, OpenAI will be the new company's primary customer. Last November, Altman was dramatically removed from his position as CEO of OpenAI, which he co-founded in 2015, for failing to be 'consistently candid' with the board. After employees and investors rebelled against the decision, Altman was reinstated within a week.