An AI chip designer located just 2 miles away from Nvidia HQ in California is coming to stock markets soon.
Cerebras is gearing up to list on the Nasdaq. And if it delivers on its bold promise of making the “fastest AI processor on earth,” it could emerge as an Nvidia challenger in the chip industry – and in the stock markets.
But…
It is a small player with far fewer clients than Nvidia. Cerebras’ revenue may have risen 220% to $78.7 million last year, but 83% of that income came from Abu Dhabi’s G42. Relying too heavily on ONE client is always risky because any dip in demand or fallout over contracts can spell the literal end.
Cerebras who?
- Cerebras develops AI software and designs chips for AI training and inference (the process of running live data through a trained AI model to solve tasks).
- It hasn’t given out details about its listing date or IPO size yet, but a $250 million funding round in 2021 valued the company at over $4 billion.
- Its biggest backer is VC firm Foundation Capital, which is known for investing in Binance, Netflix and Solana. OpenAI founder Sam Altman is also an investor.
A tenbagger?
Okay, let’s be honest, Nvidia’s multifold gains are now likely behind us. But if you are keen on a “tenbagger”, or a stock that soars 10x from its initial price, Cerebras might have that potential.
Its fund-raises have been led by Florida-based Alpha Wave Ventures, the Abu Dhabi Growth Fund and G42, which is backed by one of Abu Dhabi’s sovereign wealth funds, Mubadala. Quite something, right?
It’s got big shoes to fill (Nvidia’s stock in the past five years is 🤯 ):
Crowded field
Cerebras isn’t the only AI player eyeing an IPO, though. In the past two years, more than 60 AI companies have gone public each year globally, and around 50 are currently in the IPO registration process, according to an EY report.
But we’ve not seen anything like Nvidia’s meteoric rise yet. So, a shop next door with a similar business model going public is worth a look.
