Groq raises $350 million at $3.5 billion valuation after Nvidia deal
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Groq has raised $350 million in funding at a $3.5 billion valuation, roughly half the $6.9 billion it was worth last September before Nvidia struck a licensing deal and hired away much of its talent. Dallas-based Disruptive led the round, and Nvidia is set to invest, according to a Groq representative. The company is remaking itself as a data center operator and plans to expand capacity to more than 200 megawatts by next year.
Key Facts
- Groq raised $350 million at a $3.5 billion valuation, roughly half the $6.9 billion it was worth in September before Nvidia hired founder Jonathan Ross and other key employees.
- Dallas-based investment firm Disruptive led the round, and Nvidia is set to invest, according to a Groq representative.
- Groq previously announced a $650 million raise in June to fund its data center inference effort and reset its valuation without disclosing the figure.
- The company plans to expand total data center capacity to more than 200 megawatts by next year.
The Funding Round
Groq raised $350 million in funding at a $3.5 billion valuation, roughly half the $6.9 billion valuation it held last September. Dallas-based investment firm Disruptive led the financing, set to be announced Monday. Nvidia is also set to invest in the round, according to a representative for Groq; Nvidia did not respond to a request for comment. The startup previously announced raising $650 million in June to fund its data center effort and reset its valuation without disclosing the figure.
Nvidia Talent Shift
Nvidia hired Groq founder and Chief Executive Officer Jonathan Ross and other key employees as part of the licensing deal. Founded in 2016, Groq was among companies developing their own hardware to rival market leader Nvidia. Meta Platforms and Alphabet's Google have also hired talent from AI startups in licensing arrangements rather than buying the startups outright.
Data Center Pivot
Groq has worked to remake itself as a data center operator catering to demand for computing resources to run AI software, a process known as inference. Alex Davis, Groq's executive chairman and founder of Disruptive, said inference will become the largest and most critical layer of AI infrastructure. The company plans to use some of its recent financing to expand total data center capacity to more than 200 megawatts by next year.
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Groq raises $350 million at $3.5 billion valuation after Nvidia deal
