Nvidia to license Groq technology and hire top executives in Big Tech-style deal
Groq stated in its blog post that it will continue to operate as an independent company with Simon Edwards as chief executive and that its cloud business will continue to run as before.
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Nvidia has agreed to license chip technology from artificial intelligence startup Groq and to hire several of its senior executives, including its chief executive, the company said in a blog post on Wednesday. The move reflects a broader trend in which major technology firms strike high-value deals with emerging startups to access their technology and talent without formally acquiring them, according to a Reuters report.
Groq specialises in inference, a segment of artificial intelligence where trained models generate responses to user requests. While Nvidia dominates the market for training AI models, it faces growing competition in inference from traditional rivals such as Advanced Micro Devices as well as startups including Groq and Cerebras Systems, Reuters reported.
Groq informed that Nvidia has agreed to a non-exclusive licence for its technology. The startup stated that its founder Jonathan Ross, a former Google executive who helped launch Alphabet’s AI chip programme, along with Groq president Sunny Madra and other members of its engineering team, will join Nvidia.
A person close to Nvidia confirmed the licensing agreement, Reuters reported. Groq did not disclose the financial terms of the deal. CNBC reported that Nvidia had agreed to acquire Groq for $20 billion in cash, though neither Nvidia nor Groq commented on the report.
Groq stated in its blog post that it will continue to operate as an independent company with Simon Edwards as chief executive and that its cloud business will continue to run as before.
The deal mirrors a series of similar arrangements in recent years. Reuters reported that Microsoft brought in its top AI executive through a $650 million agreement structured as a licensing deal, while Meta spent $15 billion to hire the chief executive of Scale AI without acquiring the entire company. Amazon previously hired founders from Adept AI, and Nvidia completed a similar transaction earlier this year. These arrangements have drawn regulatory scrutiny, though none has been reversed to date, Reuters reported.
