Rebellions Inc., demonstrating increased interest in the hardware that powers artificial intelligence, raised $124 million from investors, including KT Corp., to expedite the creation of a next-generation AI chip.

At a valuation of more than $650 million, the South Korean business closed a Series B funding backed by the cellphone carrier. The finance was provided by Shinhan Venture Investment Co., Singapore’s Pavilion Capital, and KT Cloud Co., the company’s datacenter subsidiary, according to a statement. DGDV of Japan and Koreyla Capital of France joined the deal as new advertisers.

Rebellions is one of numerous up-and-coming companies vying for market share in the area of semiconductors used for AI training and operations. These companies compete with Nvidia Corp., an established leader in the industry, as well as other startups including Toronto’s Tenstorrent Inc. and California-based Groq Inc. Capital from all over the world is pouring into companies developing advanced AI, from the US to China. This surge of activity was sparked by the release of OpenAI’s ChatGPT.

With the additional funding, the Korean business intends to hire more people and work with Samsung Electronics Co. to develop “Rebel,” a next-generation AI processor meant to run massive language models. About 826 billion won ($618 million) have been set aside by South Korea to support domestic AI chip makers until 2030 in an effort to expand outside the memory semiconductor market now dominated by Samsung and SK Hynix Inc.

Big language model training is still done by Nvidia workhorses, but Rebellions and its rivals create hardware that concentrates on niche tasks like machine vision and chatbots. Its domestic rival is FuriosaAI, which is supported by the government-run Korea Development Bank and search leader Naver Corp. SK Telecom Co. and SK Hynix support Sapeon Inc., another rival from Korea.

The internet giant Kakao and the Korea Development Bank are two of Rebellions’ current investors. Having been founded in 2020, it is now utilizing Samsung’s 4-nanometer technology to manufacture its chips.