Situational Awareness has made another large private AI infrastructure bet, even after a sharp reversal in its public-market portfolio.

TechCrunch, citing The Wall Street Journal, reported that the AI-focused hedge fund invested $400 million this week in Source Foundry, a stealth chip startup founded by Stanford researchers. Techmeme's summary of the Journal report says the fund has now invested $500 million in Source Foundry in total, including the latest $400 million tranche.

The reported target is not another model lab or application company. Source Foundry is described as developing chip manufacturing tools intended for AI hardware, a bottleneck that matters as training and inference demand pushes against the limits of advanced semiconductor capacity. TechCrunch said the startup aims to make chip manufacturing faster and cheaper; Techmeme described the company as planning new AI chip manufacturing tools.

The deal is notable because of the buyer as much as the target. Situational Awareness, founded by former OpenAI researcher Leopold Aschenbrenner, recently sold most of its public stock portfolio to Citadel after losses tied to AI infrastructure stocks, according to TechCrunch. The publication also reported that the fund retained its Anthropic shares and that assets under management fell from about $20 billion to $10 billion.

The investment suggests the fund is still willing to concentrate capital in hard AI infrastructure, but the facts available publicly remain limited. With Source Foundry operating quietly and the main deal details attributed to reporting rather than company announcements, the conservative takeaway is that private capital is still chasing semiconductor tooling as an AI capacity lever, even after volatility in listed AI infrastructure names.