Fractile, a UK-based startup specializing in AI inference chips, is in advanced talks to raise capital at a $6.5bn valuation, according to Bloomberg. The potential round could bring in approximately $600m, with Lightspeed Venture Partners and Redpoint reportedly co-leading the investment. This would mark a significant jump from the $220m the company raised in May, reflecting strong investor interest in AI hardware. Founded in 2022 by CEO Walter Goodwin, Fractile has already secured backing from notable firms including Founders Fund, Accel, and Oxford Science Enterprises. The startup also has a supply agreement with US AI lab Anthropic.

The UK government has been actively supporting domestic tech innovation, recently unveiling a £1.1bn AI hardware plan to strengthen homegrown chip companies. Fractile is among several European startups racing to develop advanced AI chips, including Dutch firm Axelera, which raised $250m earlier this year, and UK-based Olix, founded by 25-year-old James Dacombe, which recently secured $312m at a $3.3bn valuation.

While the funding round remains unclosed and terms could shift, the momentum signals growing confidence in the European AI chip sector.