Intel has announced its intention to separate its corporate venture division, Intel Capital, into an independent fund, positioning Intel as an “anchor investor.”
In a press announcement made on Tuesday, Intel stated that this initiative will “[enable] greater autonomy” and “the flexibility to attract external capital.” The company anticipates that Intel Capital will operate independently starting in the latter half of 2025, at which point a rebranding will occur.
The existing team at Intel Capital will transition to the new fund, with Intel confirming that business operations will continue as usual throughout the changeover.
“The establishment of Intel Capital as a standalone entity is mutually beneficial, as it allows the fund to tap into new capital sources for expansion while enabling both parties to maintain a productive long-term strategic alliance,” stated David Zinsner, Intel’s co-CEO and CFO. “This move is aligned with our broader strategy to enhance the value of our assets while promoting greater focus and efficiency within the organization.”
Intel Capital was founded in 1991 by former Intel Executive Vice President Les Vadasz, initially aimed at fostering Intel’s ecosystem through equity investments in key companies.
Competitors like AMD and Nvidia have also established their venture funds. Nvidia has been particularly proactive, having invested approximately $1 billion in AI companies last year.
Currently, Intel Capital manages over $5 billion in assets. Over the past three decades, it has invested in more than 1,800 firms across sectors like semiconductors, 5G, devices, and cloud computing. In total, Intel Capital has allocated more than $20 billion in various markets, including North America, Western Europe, Israel, and Asia Pacific.
Since 2014, Intel Capital has increased its focus on investing in AI startups. Some of its notable portfolio companies include AI chip developer SambaNova, Israeli AI firm AI21 Labs, humanoid robotics company Figure, and the AI development platform Anyscale.
The decision to spin off Intel Capital follows the recent ousting of CEO Pat Gelsinger by the company’s board of directors, who subsequently appointed Zinsner and Michelle Johnston Holthaus as interim co-CEOs. Holthaus also serves as CEO of Intel Products, a newly established division encompassing various aspects of the company’s consumer and enterprise operations.
Intel has faced significant challenges recently, reporting a staggering quarterly loss of $16.6 billion last October—the largest in its 56-year history. Furthermore, 2024 marked Intel’s worst performance since its IPO in 1971.
In an effort to streamline operations and reduce expenditures, Intel announced plans to divest another business unit, Intel Foundry, tasked with chip manufacturing, last September. The company is currently undertaking a $10 billion cost-reduction initiative, which includes laying off 15,000 employees. Additionally, Intel is reportedly considering divesting its driverless vehicle division Mobileye and its enterprise and cloud networking segment.
Potential buyers, including Qualcomm, have reportedly expressed interest in acquiring Intel.
Compiled by Techarena.au.
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