SoftBank Group Corp. (OTC:SFTBF) founder, Masayoshi Son, is planning to raise $100 billion for a new chip venture targeting the AI market. This venture could potentially pose a challenge to Nvidia Corp. and also comes at a time when OpenAI CEO Sam Altman has set an ambitious $7 trillion AI chipmaking plan.
What Happened: Son's project, codenamed Izanagi, is his latest initiative as SoftBank scales back its startup investments. The venture's objective is to establish a company that can supplement the chip design unit of Arm Holdings Plc. (NASDAQ:ARM), thereby helping Son create an AI chip powerhouse, reported Bloomberg.
SoftBank is expected to contribute $30 billion, with the remaining $70 billion potentially sourced from Middle East investors. If successful, this would be one of the largest investments in the AI sector, surpassing Microsoft Corp.'s (NASDAQ:MSFT) $13 billion investment in OpenAI.
Details regarding the project's funding or expenditure are yet to be finalized. Son is continuously exploring various investment ideas and strategies to extend Arm's reach into the AI market and is considering different types of next-generation chips.
Why It Matters: This move comes at a time when Altman is reportedly looking for the Biden administration's approval for his $7 trillion chipmaking ambitions.
Altman has been in discussions with potential investors and partners across the US, Middle East, and Asia, with the project's advancement hinging on approval from the U.S. government.
Earlier, Altman had been in talks with global investors, including SoftBank, to secure funds for a network of semiconductor factories aimed at addressing chip shortages for AI applications.
While Son and Altman have discussed joining forces in semiconductor manufacturing, "Izanagi" currently remains separate from Altman's ambitions.
Arm CEO Rene Haas, a member of the SoftBank board, is advising Son on the project. Son is directly leading Project Izanagi, maintaining his enthusiasm for AGI (Artificial General Intelligence).
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