FuriosaAI Rejects Meta’s $800M Acquisition Offer to Forge Independent Path in AI Chips

South Korean AI chip startup FuriosaAI has rejected an $800 million acquisition offer from Meta, opting instead to pursue independent growth in the competitive AI hardware sector. The decision, driven by disagreements over post-acquisition strategy and organizational structure, underscores FuriosaAI’s confidence in its proprietary AI inference chips and long-term vision.

FuriosaAI, founded in 2017 by CEO June Paik (a former engineer at Samsung and AMD), specializes in semiconductors for AI inferencing. Its second-generation RNGD chip, designed for reasoning models, has already been tested with clients like LG AI Research and Saudi Aramco, with plans for a full launch later this year. The startup aims to challenge industry leaders Nvidia and AMD, leveraging its agile development model to innovate faster.

Meta, which has committed to investing $65 billion in AI infrastructure this year, sought to reduce its reliance on Nvidia by acquiring FuriosaAI. However, negotiations collapsed due to divergent visions for integrating FuriosaAI’s technology and maintaining operational autonomy.

FuriosaAI is now in talks to raise $48 million (KRW 70 billion) in a Series C funding round, targeting completion by the end of March. The capital will fuel mass production of its RNGD chips and operational scaling. The startup also plans an eventual IPO, signaling its ambition to become a standalone player in the AI chip market.

Meta’s failed bid highlights its challenges in securing AI hardware partnerships. While the company unveiled its custom AI chips last year, it continues to rely on Nvidia for training large language models (LLMs). The rejection may accelerate Meta’s focus on in-house chip development or alternative acquisitions to bolster its AI capabilities.

FuriosaAI’s decision reflects a broader trend of startups prioritizing independence over acquisition, particularly in high-stakes sectors like AI hardware. As the market evolves, the move positions FuriosaAI as a potential disruptor, while Meta must adapt its strategy to maintain competitiveness.