OpenAI Chief Executive Sam Altman is seeking to raise billions of dollars for a new chip manufacturing venture, Bloomberg reported today.

Reports of the project first emerged last year. However, the scope of the undertaking was unclear. Today’s report indicates that Altman hopes to establish the venture as a major player in the semiconductor market with a particular focus on the lucrative artificial intelligence chip segment. 

According to Bloomberg, the executive has held fundraising talks with SoftBank Group Corp. and Abu Dhabi-based G42. It’s believed Altman may seek to raise $8 billion to $10 billion from the latter firm alone. The fundraising effort is said to be in an early stage.

The vision behind the venture is to build a global network of semiconductor fabs, Bloomberg’s sources detailed. Realizing that vision would likely require the venture to raise tens of billions of dollars from investors, if not more. The two fabs that Taiwan Semiconductor Manufacturing Co. Ltd. is currently building near Phoenix, Arizona are expected to cost $40 billion, while Intel Corp. has allocated €30 billion for a similar construction project in Germany.

One reported driver behind the new fab venture is Altman’s concern that there may not be enough AI accelerators to meet demand. This suggests making such chips will be a major focus for the planned fab network.

Demand for the most advanced AI accelerators is already exceeding supply. Last year, some customers had to wait more than six months to receive their orders of Nvidia Corp.’s high-end H100 graphics card. Interest in the chip shows no sign of abating: Meta Platforms Inc. this week announced plans to buy 350,000 H100s by the end of the year, which amounts to about a third of last year’s total estimated supply.

The chip fabs Altman’s venture hopes to build will presumably also make other types of processors besides AI accelerators. Intel, TSMC and Samsung Electronics Co. Ltd. fabricate a broad range of processors at their semiconductor plants. It’s unclear whether Altman’s venture will produce chips using customer-provided designs, sell processors based on its own in-house blueprints or both.

Building a fab is a massively complex undertaking that requires not only capital but also highly specialized expertise. According to Bloomberg, Altman’s venture may partner with established chipmakers to help build its manufacturing infrastructure. Intel, TSMC and Samsung were floated as potential partners.

There are some existing examples of fab operators teaming up on manufacturing projects. Last year, Tower Semiconductor Ltd. inked a deal to move up to $300 million worth of chipmaking equipment into an Intel fab in New Mexico. That equipment will be used to make semiconductors for the former company’s customers.

For Altman’s venture, establishing partnerships with established chipmakers may prove challenging in certain respects. If the startup moves into the AI accelerator market, it may find itself competing with Intel, a potential partner that offers its own line of AI accelerators. TSMC and Samsung, in turn, make AI accelerators based on customer-provided designs.

Microsoft, OpenAI’s top backer, has reportedly expressed interest in Altman’s venture. The cloud computing and software giant recently debuted an internally developed AI accelerator called the Maia 100. In the future, Microsoft could potentially partner with Altman’s venture to manufacture its custom chips. 

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