U.S. Forces Saudi Fund To Exit Altman-Backed AI Chip Venture

The Biden administration has reportedly compelled a Saudi Aramco-backed venture capital firm to divest its shares in Rain Neuromorphics, a Silicon Valley AI chip startup supported by OpenAI co-founder Sam Altman.

Altman-backed Rain Neuromorphics, which focuses on designing chips that emulate the functioning of the human brain for applications in artificial intelligence (AI) algorithms, successfully raised $25 million in funding in 2022. I Photo: TechCrunch Flickr

Rain Neuromorphics, which focuses on designing chips that emulate the functioning of the human brain for applications in artificial intelligence (AI) algorithms, successfully raised $25 million in funding in 2022.

Prosperity7, an investment arm of Aramco and a key contributor to Rain AI's $25 million financing round, chose to sell its shares in the startup following a review by the Committee on Foreign Investment in the United States (CFIUS), according to Bloomberg News.

CFIUS, a US watchdog overseeing transactions with potential national security implications, reportedly advised the Saudi fund to unwind its investment in Rain Neuromorphics sometime within the past year.

The US Treasury, responsible for overseeing the CFIUS process, refrained from providing specific details but stated, "CFIUS is committed to taking all necessary actions within its authority to safeguard US national security. Consistent with law and practice, CFIUS does not publicly comment on transactions that it may or may not be reviewing."

The Committee on Foreign Investment in the United States (CFIUS) is an inter-agency committee tasked with evaluating and potentially blocking foreign investments in US businesses and real estate if national security concerns are raised.

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