Nvidia Corp. agreed to a licensing deal with artificial intelligence startup Groq, furthering its investments in companies connected to the AI boom and gaining the right to add a new type of technology to its products.
The world’s largest publicly traded company has paid for the right to use Groq’s technology and will integrate its chip design into future products. Some of the startup’s executives are leaving to join Nvidia to help with that effort, the companies said. Groq will continue as an independent company with a new chief executive, it said Wednesday in a post on its website.
Nvidia’s technology already dominates data centers that are at the heart of the explosion in spending on new computing needed for AI software and services. The popularity of its existing offerings has made Nvidia by far the richest company in the chip industry and it has said it will use some of that cash to advance the uptake of AI across the economy.
Groq is among the startups and companies such as Alphabet Inc.’s Google that are developing their own AI chips to rival Nvidia. The startup, which was founded in 2016, raised $750 million at a post-funding valuation of $6.9 billion in September. At the time, Groq said it would use the funds to expand its data center capacity. Its data center business, which offers outsourced computing, will continue, the company said in the post.
Groq Chief Executive Officer Jonathan Ross is a former Google chip executive who helped start that company’s Tensor Processing Unit, or TPU, which powers AI workloads. As part of the deal, he and other top executives will join Nvidia “to help advance and scale the licensed technology,” Groq said in the statement.
No financial details were released.
Groq’s low-latency chips are extremely responsive to inputs and will add new capabilities to Nvidia’s products and open up new areas of the market, Nvidia said. Under the leadership of Chief Executive Officer Jensen Huang, the chipmaker has added a myriad of new offerings aimed at cementing its position and speeding up the rate at which companies find a use for AI software. The company now sells networking, software and services as well as complete computers.
The licensing deal is similar in some ways to a partnership Meta Platforms Inc. reached with data labeling startup Scale AI, in which the big tech company made a sizable investment in the smaller firm, licensed technology and hired its CEO.
