Intel says it plans to spin off its venture capital arm, Intel Capital, into a standalone fund, with Intel as the “anchor investor.”
In one press release on Tuesday, Intel said the move would “[enable] greater autonomy’ and ‘flexibility to attract external capital’. Intel expects Intel Capital to begin operating independently in the second half of 2025, when it will be renamed.
Intel Capital’s existing team will move into the new fund and business will continue as normal throughout the transition, Intel said.
“The separation of Intel Capital is a win-win scenario, as it provides the fund with access to new sources of capital to expand its franchise, while allowing both companies to continue to benefit from a productive long-term strategic partnership,” said David Zinsner, Intel Partner. – The CEO and CFO, said in a statement. “This step supports our broader strategy to maximize the value of our assets while driving greater focus and efficiency across the business.”
Intel founded Intel Capital in 1991 under former Intel executive vice president Les Vadasz. Intel Capital’s original mission was to support the growth of the Intel ecosystem through equity investments in strategic companies.
Intel rivals AMD and Nvidia followed suit with their own venture funds. Nvidia in particular was aggressive with its investments last year pouring out about $1 billion in AI companies.
Today, Intel Capital has more than $5 billion in assets under management. Over the past 30 years or so, it has invested in more than 1,800 companies in areas including silicon, 5G, devices and cloud. In total, Intel Capital has committed more than $20 billion in cash to markets including North America, Western Europe, Israel and Asia Pacific.
Since 2014, Intel Capital has increased its investment in AI startups. Some of its most notable portfolio companies are AI chip startup SambaNova, Israeli AI company AI21 Labs, humanoid robotics company Figure, and AI developer platform Anyscale.
Intel’s decision to spin out Intel Capital comes after the company’s board of directors forced out CEO Pat Gelsinger last month replaced Zinsner and Michelle Johnston Holthaus as interim co-CEOs. Holthaus is also CEO of Intel Products, a newly created division that spans the chipmaker’s consumer-focused organization as well as its data center, artificial intelligence, network and edge businesses.
Intel has been doing it hard lately. Last October, the company posted a quarterly loss of $16.6 billion — the biggest in its 56-year history. And 2024 was Intel’s worst year yet since its release in 1971.
In an effort to streamline operations and cut costs, Intel made moves to spin off another of its business units, the Intel Foundry, which is responsible for making chips, in September. Intel is in the midst of a $10 billion cost-cutting plan that has included laying off 15,000 employees. And the company is said to have considered selling Mobileye’s driverless vehicle arm and enterprise networking and cloud division.
Suitors, including Qualcomm, have reportedly approached Intel about a potential acquisition.
