By Yuliya Chernova
Chip company Cerebras Systems, which went public on Thursday, is a fund-returner several times over for its early venture backers.
The company opened trading at $350 a share on Thursday, almost double its initial public offering price of $185. It closed down 11.1% at $311.07 and an estimated market capitalization of $66.95 billion, according to FactSet.
For early investors, the IPO is the culmination of a decadelong story. Cerebras was launched when semiconductor startups were out of favor, went through a few near-death experiences, and then caught the artificial-intelligence updraft.
Three of the company's largest shareholders -- Benchmark, Foundation Capital, and Eclipse -- had first backed the company in its 2016 Series A round. The shares owned by these three early backers were worth about $8.58 billion at the offering price of $185. The principal shareholders weren't able to sell shares in the IPO under standard lockup restrictions.
Benchmark's stake
Benchmark's stake of 17.6 million shares stood at about $3.26 billion, at the offering price. Benchmark had invested a total of $268 million over the years, according to a person familiar with the situation. The firm's initial investments in Cerebras, led by General Partner Eric Vishria, came out of its $425 million Fund VIII, the person said. Vishria is a Cerebras board member.
In January, after Cerebras signed a megadeal with OpenAI, Vishria wrote about Cerebras's technical accomplishments in a post on X.
"But even more impressive, is they just never f -- quit, despite kissing death like 3 times, getting made fun of for unusual early customers, and getting passed over by virtually every respected semi investor (who have all converted now)," he wrote.
Foundation Capital's stake
Foundation's stake was worth $2.83 billion at the offering price. The firm had invested $36.8 million over the years, acquiring more than 15.3 million shares, according to Foundation.
Foundation invested out of its $325 million Foundation Capital 8, said Steve Vassallo, general partner at the firm, and a Cerebras board member. The IPO is returning that fund "many, many, many times over," Vassallo said.
"We co-led the Series A with Eric from Benchmark and the company started in our Entrepreneur in Residence/incubation space on the second floor of our old office," Vassallo said.
Eclipse's stake
Eclipse, which also invested in the Series A in 2016, has a stake worth $2.49 billion at the offering price. It invested a total of $145.4 million for about 13.5 million shares, according to the firm.
Eclipse first invested out of its $125 million Eclipse Ventures Fund 1. That fund alone holds more than $1 billion of Cerebras shares at the $185 price, meaning that bet returned eight times the amount raised by the fund.
Back in 2016, the early investors were betting that Cerebras would find a market to use its chips for machine learning applications. "It was pre-AI," said Lior Susan, founder and chief executive of Eclipse, and a Cerebras director.
The venture industry was down on the chip sector at the time, after slowing growth in personal computers and smartphones. But a few did see an opportunity in emerging deep-learning applications.
Other major shareholders include Fidelity Management, whose stake stood at $3.78 billion, and Alpha Wave, at $2.23 billion.
The IPO proves that entrepreneurs "solving fundamental hardware problems have an opportunity to build $100 billion companies," Susan said after ringing the opening bell with the Cerebras executives and investors for the Nasdaq Stock Market.
Write to Yuliya Chernova at yuliya.chernova@wsj.com
(END) Dow Jones Newswires
May 14, 2026 19:35 ET (23:35 GMT)
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