Fractile secures $720 million in funding: stacking memory on chips to make AI inference 10 times faster.

Beating AI News Flash: UK AI chip startup Fractile has completed a $720 million Series C funding round, reaching a post-money valuation of $7 billion. In May of this year, the company had just raised $220 million at a valuation of approximately $1.1 billion. In less than half a year, its valuation has grown 6.4 times.

The most distinctive thing about this company is that it has yet to launch a mass-produced chip, yet it has attracted well-known investment institutions such as Founders Fund, Google's CapitalG, and Lightspeed, with even the UK government's sovereign AI fund participating in the investment.

Fractile aims to solve the memory bottleneck in AI inference. Every time a large model generates a token, it needs to repeatedly read model parameters and context. Even if the chip's computing power is strong, if memory transfer speed cannot keep up, the compute units can only wait for data.

Fractile's approach is to stack custom DRAM memory directly on top of the compute chip, rather than placing HBM high-bandwidth memory alongside it as mainstream GPUs do. It aims to significantly increase data transfer speed while retaining large capacity. Founder Walter Goodwin claims that this design could boost AI inference response speed by 10 times.

Anthropic has also been reported to be in partnership with this company. Bloomberg in August of this year cited people familiar with the matter as saying that the two sides reached a preliminary chip procurement agreement worth approximately $250 million. However, the latest report from the Financial Times used more cautious wording, stating only that Anthropic is interested in becoming an early customer.

Fractile plans to deliver its first batch of chips and systems in 2027.