OpenAI Acquired Patents from Altman-Backed AI Chip Startup Following Failed Acquisition

There’s no question that some of the companies OpenAI CEO Sam Altman has invested in—like chipmaker Cerebras and nuclear fusion firm Helion Energy—have benefitted from doing business with the firm Altman leads. However, just because Altman is an investor in a startup doesn’t mean that OpenAI will be that helpful.

Take AI chip startup Rain AI, which counts Altman as an investor. The eight-year old firm all but closed its doors recently, with almost all employees leaving, after a failed effort to find a buyer. OpenAI looked but ended up buying some of Rain’s patents. That was about all OpenAI did.

To understand the history, we have to go back a bit in time. Rain was founded in 2017, aiming to develop a new kind of chip. Its patents give a sense of its ambitions: the patents focused on how to do AI computations closer to a chip’s memory, rather than shuttling data between separate memory and processing units, which can be slower and more power-intensive, according to a person briefed on the decision and patent filings.

Altman invested in a seed round in 2018. The year after that, OpenAI signed a nonbinding letter of intent with Rain AI to spend $51 million on the startup’s chips when they became available. But OpenAI never ended up buying any of those chips because the agreement was predicated on a successful pilot of the chips, said a person with knowledge of the agreement.