AI chipmaker Groq confirms $650M raise, re-staffs after Nvidia’s $20B not-acqui-hire deal
NVIDIA Corp. — what does an AI company do after one of those not-acqui-hire deals? Groq raised money, is leaning into its neocloud business, and hiring new execs.
On Monday, Groq announced a new $650 million funding round, confirming earlier reports. The round was led by Disruptive, a Dallas-based late-stage investment firm founded by Alex Davis — who also serves as Groq’s chairman — and Infinitum, a Fort Lauderdale hedge fund. The raise comes roughly six months after Nvidia signed a non-exclusive licensing agreement for Groq’s technology and hired away founder and CEO Jonathan Ross, president Sunny Madra, and other employees. Groq did not disclose its new valuation. It was last valued at $6.9 billion following a $750 million round in September. Ross, who came from Google, was known in the AI chip world for helping create Google’s AI chip, the Tensor Processing Unit. He teamed up with another Google engineer, Doug Wightman, to launch Groq a decade ago. Wightman stayed on after the Nvidia deal and became CEO. Groq created a chip it called a language processing unit (LPU), used for inference, and sold it as part of a cloud service or an on-premises hardware cluster. With Nvidia now owning the IP for LPUs, the GPU giant announced its own hardware cluster, the Nvidia Groq 3 LPX inference hardware system, at its GTC event in March. In response, Groq has pivoted to its neocloud business, it said. That business had been run by Madra after Groq acquired his AI data analytics company Definitive Intelligence, in 2024. It has grown to 13 data centers across North America, Europe, the Middle East, and APAC and is serving over five million developers and thousands of AI companies, processing trillions of tokens each week, the company says. Groq has also been hiring replacement execs. It added Alan Rice as COO, previously at xAI and Meta, after a career in the U.S.
