British semiconductor company Graphcore has announced on Tuesday that it had raised investments worth $222 million as it looks to compete with U.S rivals Nvidia and Intel.

The Series E funding round comes less than a year after the UK based chip maker raised a $150 million extension to its last round. Graphcore informed that it would use the funding to work towards global expansion and speed up its Intelligence Processing Units (IPUs). The IPUs are specifically designed to power AI software. The company, which now values at $2.77 billion, up from $1.5 billion in 2018, has already shipped tens of thousands of its chips to customers including Microsoft and Dell.

Graphcore CEO and co-founder Nigel Toon told CNBC in July: “We’re now at the point where we’re not really looking for venture investors in the business. We’re more interested in companies that would be long term investors and holders of the stock, perhaps, in the public markets, if we ever reach that point.”

Total investment now stands at $710 million in Graphcore and the company has $440 million of cash on hand.

According to CNBC, the latest funding round was led by the Ontario Teachers’ Pension Plan Board, and other new investors reportedly included venture capital investor Draper Esprit, private equity investor Baillie Gifford, and funds managed by Fidelity International and Schroders.

Toon said in a statement on Tuesday: “Having the backing of such respected institutional investors says something compelling about how the markets now view Graphcore. The confidence they have in us comes from the competence we have demonstrated in building our products and our business.”

He added: “We have created a technology that dramatically outperforms legacy processors such as GPUs, a powerful set of software tools that are tailored to the needs of AI developers, and a global sales operation that is bringing our products to market.”

In spite of the disruption caused by the coronavirus pandemic, Graphcore launched its second-generation IPU earlier this year.

Serial chip entrepreneurs

Graphcore raises $222 million to scale up AI chip production — Graphcore co-founders. Image: Elmoudjaweb

Founded in June 2016 by Toon and Simon Knowles, the idea of Graphcore came to the pair in a small pub in January 2012. Today, the company employs around 450 people in the UK, China, Taiwan, and the US. The number is expected to grow to about 600 by 2021 end.

But the rapid growth hasn’t come cheap; according to an annual report filed on U.K. business registry Companies House, Graphcore made a pre-tax loss of $95.9 million on revenues of $10.1 million in 2019.

US chipmaking giants Intel and Nvidia are two of the obvious front runners in the AI chip market, given their long run and expertise in chip making. In 2019, 15.7% of Intel’s overall chip sales were made, and it had led the market each year since 2008 except for 2017 (when Samsung won the race for the year).

Some of the big companies working on their own AI chips include Google, Amazon, and Apple.