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Analog Chips Could Offer Up to 160% Power Savings by 2030
Graphics processing units (GPUs), the key components powering most AI models, are extremely energy-hungry. According to Goldman Sachs, the rising use of GPUs in data centres will result in a 160% surge in global electricity usage by 2030.
Vishal Sarin, a long-time chip designer, believes this trend isn’t sustainable. He founded Sagence AI to create energy-efficient alternatives to today’s dominant digital chips. Sarin said the goal is to “break the performance and economics limitations in an environmentally responsible way.”
Sagence aims to solve the power consumption problem by developing analog chips rather than digital ones. In contrast to most conventional chips, which store data digitally as ones and zeros, Sagence’s analog chips represent data using multiple values. This allows them to handle more information in a smaller amount of space.
Why Analog Chips for AI?
Analog chips are not new. They were widely used from 1935 to 1980 and helped manage large systems such as the North American electrical grid. Recently, their efficiency has caught the attention of tech companies as a response to the rising demand for AI processing power.
Comparison of digital vs. analog chips
| Feature | Digital Chips | Analog Chips |
|---|---|---|
| Data format | Binary (1s and 0s) | Range of values |
| Components for calculations | Hundreds per calculation | Just a few modules |
| Data transfer bottleneck | Data moves between memory and processor | In-memory processing |
| Data storage density | Lower | Higher |
Digital chips require significantly more power to shuttle data between processors and memory. This slows processing and increases energy use. Sarin argues this problem is blocking AI developments globally.
Overcoming Analog’s Challenges
Analog tech isn’t perfect. Precision is one issue: analog chips demand very fine manufacturing tolerances. Programming them also adds complexities.
However, Sarin explained that Sagence isn’t trying to replace digital chips but complement them. He envisions their analog chips enhancing performance in specialized AI applications, from servers to mobile devices. “The primary goal is eliminating power, cost, and latency issues,” Sarin said.
Sagence’s Future
Sagence plans to bring its chips to market by 2025. It’s already working with several potential customers in its development phase. Interested parties span industries as varied as mobile tech and server hardware, confirmed Sarin.
At the same time, Sagence is competing with other analog chip companies in the space like EnCharge and Mythic, both of which are also building energy-efficient AI chips.
Sagence’s main backers
| Investor Name | Type of Investment |
|---|---|
| Vinod Khosla | Venture Capital |
| TDK Ventures | Corporate Ventures |
| Cambium Capital | Institutional Investor |
| Blue Ivy Ventures | Individual Venture Fund |
| Aramco Ventures | Corporate Venture Capital |
| New Science Ventures | Deeptech Venture Capital |
Sagence has raised $58 million so far from these investors since its inception. Moving forward, the company plans to raise additional capital to expand its current team of 75 people.
Perfect Timing for Semiconductors?
2023 was a rough year for the semiconductor sector, but things appear to be turning around. Between January and July 2023 alone, nearly $5.3 billion was raised by semiconductor startups. This is especially good news for Sagence, which is entering the market just as things begin to rebound.
However, chip development is notoriously expensive. Sagence will need solid financial backing over the next several years as well as clever strategies to lure in customers who are committed to well-established ecosystems like Nvidia’s.
One example of how challenging that can be: last year, rival AI chip maker Graphcore, which raised almost $700 million in funding, filed for insolvency. The company struggled to convince key players to switch from Nvidia GPUs to its hardware.
What’s Next for Sagence?
Sagence believes it can deliver a leap in energy efficiency over today’s GPUs. Now it’s a matter of proving that its analog tech can match digital chips on performance while slashing power consumption. While time will tell, with a market launch set for 2025, Sagence has its eyes on being a major player in reducing the power drain of modern AI.
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