Fractile, a British company developing customised chips for AI applications, is in advanced discussions to secure a pre-money valuation of $6.5bn in its latest fundraising round, reported Bloomberg, citing sources familiar with the matter.
The startup expects to raise approximately $600m, although a portion of the funds has been invested at a lesser valuation.
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The ongoing round is being co-led by Lightspeed Venture Partners and Redpoint Ventures, the people said, with Thrive Capital and Founders Fund also reported as co-leads.
Fractile has recently reached an initial agreement to supply around $250m of its chips to Anthropic, with intentions to expand the contract in future, the sources added.
The chips are not anticipated to be available for use until 2027.
Founded in 2022 by University of Oxford roboticist Walter Goodwin, Fractile is focused on developing systems that improve the efficiency of AI model inference, enabling faster generation of answers and solving of complex problems.
The startup claims its technology could be applied in diverse areas beyond chatbots, including AI-powered drug and materials discovery.
In May, Fractile closed a $220m funding round, which was led by Founders Fund, Accel, and Factorial Funds, joined by Gigascale, Buckley Ventures, Conviction, 8VC, O1A, Felicis, and other existing investors.
Proceeds from the funding were expected to support the accelerated development and release of Fractile’s inaugural chips and systems, along with expanding its teams in the UK, US, and Taiwan.
In February, the company announced plans to invest £100m over three years in its UK operations, directing funds towards expanding its London and Bristol sites and establishing a new hardware engineering centre in Bristol.
Fractile stated that this investment aligns with broader government initiatives to position the UK as a centre for AI and data infrastructure.
