Joe Biden Forces Investors Funded By Saudi Aramco To Sell Their Shares In The Startup Chip AI

US President Joe Biden (photo: x @potus)

On Thursday, November 30, Bloomberg News reported that US President Joe Biden's administration had forced venture capital firms backed by Saudi Aramco to sell its shares in an artificial intelligence (AI) chip startup in Silicon Valley backed by OpenAI founder Sam Altman.

Rain Neuromorphics, backed by Altman, is a startup that designs chips that mimic the way the brain works and aims to serve companies that use artificial intelligence algorithms. This startup managed to raise USD 25 million (IDR 385.8 billion) in 2022.

Aramco's Prosperity7, one of the main investors in the funding round of US$25 million for Rain AI, sold its stake in the startup after a review by the Foreign Investment Committee in the United States (CFIUS).

According to the report, CFIUS, which is the United States supervisory agency for transactions with national security implications, ordered the Saudi investor to withdraw the deal within the past year.

Sam Altman has not yet responded to requests for comment from the media.

The United States Department of Finance, which oversees the CFIUS process, said, "CFIUS is committed to taking all necessary measures in its authority to protect the national security of the United States. In accordance with laws and practices, CFIUS does not publicly comment on transactions that may be moderate or not under review."

CFIUS is an inter-agent committee that reviews foreign investment in business and property in the United States involving national security concerns.

The actions taken by the United States could slow down the development of artificial intelligence in the Middle East. In August, the US expanded export restrictions on advanced artificial intelligence chips from Nvidia companies and Advanced Micro Devices covering several countries in the Middle East.