Groqs

NVIDIA has reached an agreement to “license” assets from Groq and will pay 20 billion dollars for said assets. The company—not to be confused with Elon Musk’s chatbot, Grok—has been designing and manufacturing AI chips for model inference for years. The quotes around “licensing” are important, because this is not a deal: it is a stealth acquisition. what has happened. on Wednesday the news appeared that NVIDIA had agreed to sign a licensing agreement with AI startup Groq. This news was confirmed by those responsible for Groq themselves. on your blogin which they talked about a “non-exclusive license agreement for inference technology to accelerate AI inference on a global scale.” But what both companies say is one thing and what this really is is quite another. How to buy a company without buying it. As part of the agreement, the company’s CEO and co-founder, Jonathan Ross, will go to work for NVIDIA, as will Sunny Madra – its current president – and other senior executives who “will join NVIDIA to help NVIDIA advance and scale this licensed technology.” At Groq they point out that they will continue to operate as an “independent company” led by Simon Edwards, who was their chief financial officer (CFO) and will now become the CEO. NVIDIA keeps (almost) everything. In September Groq raised a financing round of 750 million dollarswhich placed its valuation at $6.9 billion. Disruptive, Blackrock and other companies participated. Alex Davis, CEO of Disruptive, indicated on CNBC that NVIDIA will keep all of Groq’s assets except for one: Groq’s newly launched cloud business. NVIDIA’s biggest “pseudo-acquisition”. This operation is by far the most important for NVIDIA, which bought the Israeli company Mellanox —which designs chips—for $6.9 billion in 2019. In an internal email obtained by CNBC, NVIDIA CEO Jensen Huang explained that “although we are adding talented employees to our ranks and licensing Groq’s intellectual property, we are not acquiring Groq as a company.” The phrase is significant but sensitive, and NVIDIA may want to escape regulators’ scrutiny with this type of pseudo-acquisition. They already made another pseudo-acquisition before. Last September NVIDIA made an identical move by “betting” 900 million dollars by server startup Enfabrica. As in this case, they called to that operation a licensing agreement for its technology, but as in this case what happened is that the CEO of Enfabrica, Rochan Sankar, and other employees, ended up being part of the NVIDIA staff. What is Groq?. Although the name is confused with that of the xAI chatbot, this AI startup does something very different from that model. Groq was founded in 2016 by a group of former Google engineers led by Jonathan Ross and Douglas Wightman. Ross was one of the designers of Tensor Processing Units (TPUs), and Wightman was part of the Google X team and would end up becoming Groq’s first CEO until his departure in 2016. What Groq does. The company has designed AI chips that are specifically specialized in inferring AI models, or in other words, accelerating the execution of those models. While NVIDIA and other companies are especially focused on chips for model training, an equally critical phase, they are not as prepared for inference. Chatbots at full speed. That’s where Groq comes in, who allows extraordinary acceleration of inference and ensure that when we chat with models they “write” at very high speeds. This is when very high token/s speeds are obtained, far above other infrastructures. Not only that, Groq is also cheaper thanks to its specialized chips, so if you want your chatbot to respond at full speed, Groq chips are a fantastic option. How to be a monopoly without saying it. This investment by NVIDIA demonstrates its intention to diversify its business and not stay stuck in its own solutions. The huge operation gives it a major competitive advantage because none of the big AI companies today had focused specifically on inference chips. Groq did from the beginning, and with this “deal” it seems clear that NVIDIA’s dominance in this sector can be strengthened. Is, some analysts saya defensive move rather than a strategic one, and they may be right: Google is getting stronger and stronger with its TPUsand that now Groq is basically part of NVIDIA – although they don’t want to say it that way – will allow it to compete better against the aforementioned Google and the rest of the rivals that are beginning to challenge that dominance. Image | Groq | NVIDIA In Xataka | AMD’s problem is not that it doesn’t make good GPUs for AI. It’s not even close to NVIDIA