When a venture capital firm creates entirely new investment vehicles just to bet more money on a single company, you know something interesting is happening. Cerebras Systems just closed a $1 billion funding round at a $23 billion valuation, nearly tripling where it stood six months ago. Tiger Global led the round, but the real story is Benchmark Capital throwing at least $225 million at the company.
Benchmark doesn’t do this kind of thing lightly. The firm deliberately caps its funds under $450 million, so when they wanted to put serious money into Cerebras, they had to get creative. According to regulatory filings, they set up two separate vehicles called ‘Benchmark Infrastructure’ specifically to funnel cash into this deal. That’s conviction.
The Chip That Ate The Wafer
What Cerebras builds is genuinely weird in the semiconductor world. Most chips are tiny rectangles sliced from circular silicon wafers like you’re cutting brownies from a pan. Cerebras said screw that and decided to use almost the entire wafer as a single chip.
Their Wafer Scale Engine is roughly 8.5 inches on each side and contains 4 trillion transistors. That’s not a typo. The thing has 900,000 cores working together, which means AI calculations can happen without data constantly jumping between different chips. That constant shuffling is what bogs down traditional GPU setups, and Cerebras claims their approach runs inference tasks more than 20 times faster than competitors.
It’s the kind of audacious engineering that makes you wonder why nobody tried it before. The answer is probably because it’s incredibly hard to manufacture something that large without defects ruining the whole thing.
The OpenAI Deal and The G42 Problem
Last month Cerebras signed a deal with OpenAI worth over $10 billion to provide 750 megawatts of computing power through 2028. Sam Altman, who also happens to be a Cerebras investor, clearly sees value in what they’re building. When you’re trying to make AI responses faster, having hardware that can actually deliver makes a difference.
But the path to going public has been messy. G42, a UAE-based AI company, was responsible for 87% of Cerebras’ revenue in the first half of 2024. That’s a terrifying level of customer concentration for any business. Worse, G42’s connections to Chinese technology companies triggered a national security review that forced Cerebras to withdraw an earlier IPO filing in early 2025.
By late last year, G42 was removed from the investor list entirely. Problem solved, sort of. Cerebras is now eyeing a second quarter 2026 public debut, according to Reuters.
What Benchmark Sees That Others Don’t
Benchmark first backed Cerebras in 2016 when they led a $27 million Series A. That was ten years ago now, which in startup terms is an eternity. Most venture bets either pay off or die within five to seven years. Cerebras has been grinding away at an incredibly difficult technical problem for a decade, and Benchmark has stuck with them the entire time.
Now they’re creating special funds to pour even more money in. That tells you they believe the AI infrastructure race is far from over, and that Nvidia’s dominance isn’t as unshakeable as it looks. Whether Cerebras can actually deliver on that promise at scale remains to be seen, but at least one prominent Silicon Valley firm is betting hundreds of millions that the answer is yes.
The real test comes when they finally go public and have to prove their tech works for customers beyond OpenAI and whoever replaced G42 in their revenue mix. Until then, this is still a story about potential rather than proven market dominance.
