AMD to take over Finnish AI start-up Silo AI for $665mn, plans to take down NVIDIA

AMD is set to acquire Finnish AI startup Silo AI for $665 million in an all-cash deal, marking one of the largest takeovers of an AI startup in Europe. This acquisition is part of AMD’s strategy to enhance its AI services and compete with market leader NVIDIA.

Silo AI, based in Helsinki and one of the largest private AI labs in Europe, specializes in custom large language models (LLMs) similar to those used in chatbots like OpenAI’s ChatGPT and Google’s Gemini.

The deal, expected to close in the second half of this year pending regulatory approval, will see Silo AI’s 300-member team using AMD’s software tools to build these LLMs. This move aligns with AMD’s goal to accelerate customer engagements and deployments, as well as to enhance its AI technology stack, according to Vamsi Boppana, AMD’s senior vice-president of artificial intelligence.

This acquisition is the largest of a privately held AI startup in Europe since Google bought UK-based DeepMind for around £400 million in 2014. It comes amid increased scrutiny of Silicon Valley buyouts by regulators in Brussels and the UK.

European AI startups, including Mistral, DeepL, and Helsing, have attracted significant investment this year as investors seek a local champion to rival US-based companies like OpenAI and Anthropic.

Silo AI, which launched an initiative last year to develop LLMs in European languages such as Swedish, Icelandic, and Danish, offers tailored AI models and platforms to enterprise customers.

The Finnish company is committed to open-source AI models, distinguishing itself from companies like OpenAI and Google, which use proprietary models. Silo AI’s family of open models, called “Poro,” aims to strengthen European digital sovereignty and democratize access to LLMs.

The acquisition highlights AMD’s efforts to quickly scale its business and enhance customer engagement with its AI offerings. Silo AI is seen as a bridge between AMD’s foundational AI software and real-world applications of the technology.

AMD’s AI technology competes with NVIDIA, which dominates the high-performance chip market and has seen its valuation soar past $3 trillion this year due to the increasing demand for computing infrastructure to power large AI models.

NVIDIA’s success is largely attributed to its investment in Cuda, its proprietary software that has expanded from processing computer graphics to running a wide range of applications. NVIDIA now offers over 600 pre-trained models and has recently introduced a “microservices” platform called NIM to help developers quickly build chatbots and AI “co-pilot” services. While NVIDIA historically offered its software for free to chip buyers, it plans to charge for products like NIM.

AMD, along with companies like Meta, Microsoft, and Intel, is contributing to the development of Triton, an OpenAI-led alternative to Cuda.

Triton aims to allow AI developers to switch more easily between chip providers, offering a more flexible and competitive ecosystem for AI development. This acquisition of Silo AI is a strategic move for AMD to strengthen its position in the rapidly growing AI market and challenge NVIDIA’s dominance.