Groq, a startup that develops chips to run generative AI models faster than traditional processors, announced Monday that it has raised $640 million in a brand new funding round led by BlackRock. Neuberger Berman, Type One Ventures, Cisco, KDDI and Samsung Catalyst Fund also participated.
The tranche, which brings Groq's total to over $1 billion and values the corporate at $2.8 billion, is a giant win for Groq, which was reportedly originally We need to increase 300 million dollars in a a bit lower ($2.5 billion) valuation. That's greater than double Groq's previous valuation (~$1 billion) in April 2021, when the corporate raised $300 million in a round led by Tiger Global Management and D1 Capital Partners.
Meta's chief AI scientist Yann LeCun will join Groq as a technical advisor, and Stuart Pann, the previous head of Intel's foundry business and former CIO at HP, will join the startup as chief operating officer, Groq also announced today. LeCun's appointment is somewhat unexpected given Meta's investments in its own AI chips – nevertheless it undoubtedly gives Groq a strong ally in a highly competitive market.
Groq, which emerged from obscurity in 2016, is developing what it calls a language processing unit (LPU) inference engine. The company claims its LPUs can run existing generative AI models, whose architecture is analogous to OpenAI's ChatGPT and GPT-4o, at ten times the speed and using one-tenth the energy.
Groq CEO Jonathan Ross is thought for helping invent the Tensor Processing Unit (TPU), Google's dedicated AI accelerator chip used to coach and run models. Ross teamed up with Douglas Wightman, an entrepreneur and former engineer at Google parent company Alphabet's X Moonshot Lab, to co-found Groq nearly a decade ago.
Groq offers an LPU-based developer platform called GroqCloud that gives “open” models reminiscent of Meta's Llama 3.1 family, Google's Gemma, OpenAI's Whisper and Mistral's Mixtral, in addition to an API that lets customers use the chips in cloud instances. (Groq also runs a playground for AI-powered chatbots, GroqChat, which launched late last 12 months.) As of July, GroqCloud had over 356,000 developers; Groq says a number of the proceeds from the round might be used to scale capability and add latest models and features.
“Many of those developers work at large firms,” Stuart Pann, COO of Groq, told TechCrunch. “We estimate that over 75% of Fortune 100 firms are represented.”
As the generative AI boom continues, Groq faces increasing competition from each rival AI chip upstarts and Nvidia, the formidable top dog within the AI hardware sector.
Nvidia controls an estimated 70 to 95 percent of the marketplace for AI chips used to coach and deploy generative AI models, and the corporate is taking aggressive steps to take care of its dominance.
Nvidia has committed to releasing a brand new AI chip architecture yearly, quite than every other 12 months as before. And it’s According to reports Established a brand new business unit focused on developing customized chips for cloud computing firms and others, including AI hardware.
In addition to Nvidia, Groq competes with Amazon, Google, and Microsoft, all of which supply or will soon offer custom chips for AI workloads within the cloud. Amazon has its Trainium, Inferentia, and Graviton processors available through AWS; Google Cloud customers can use the aforementioned TPUs and, in time, Google's Axion chip; and Microsoft recently launched Azure instances as a preview for its Cobalt 100 CPU; Maia 100 AI Accelerator instances are as a consequence of follow in the subsequent few months.
Groq could see Arm, Intel, AMD and a growing variety of startups as competitors in an AI chip market that some analysts say could reach $400 billion in annual revenue over the subsequent five years. Arm and AMD specifically have thriving AI chip businesses, due to increasing capital expenditure from cloud providers to satisfy the capability needs for generative AI.
D-Matrix at the tip of last 12 months behaved $110 million to commercialize the first-of-its-kind inference computing platform. In June, Etched emerged from obscurity and invested $120 million in a processor specifically designed to speed up the currently dominant generative AI model architecture, the Transformer. SoftBank's Masayoshi Son is According to reports wants to lift $100 billion for a chip company that may compete with Nvidia. And OpenAI is said are in talks with investment firms to launch an initiative to supply AI chips.
To fill its area of interest, Groq is investing heavily in corporate and government work.
In March, Groq acquired Definitive Intelligence, a Palo Alto-based company that gives a spread of business-focused AI solutions, and created a brand new business unit called Groq Systems. Groq Systems will serve organizations, including U.S. government agencies and sovereign states, that need to deploy Groq chips into existing data centers or construct latest data centers using Groq processors.
Groq recently partnered with Carahsoft, a government IT contractor, to sell its solutions to public sector customers through Carahsoft's reseller partners. The startup also has a letter of intent to put in tens of hundreds of its LPUs within the Norwegian data center of European company Earth Wind & Power.
Groq can also be working with Saudi Arabian consulting firm Aramco Digital to put in LPUs in future data centers within the Middle East.
While Mountain View, California-based Groq is constructing customer relationships, it’s also preparing for the subsequent generation of its chips. In August last 12 months, the corporate announced it might sign a cope with Samsung's foundry business to supply 4nm LPUs which are designed to supply higher performance and efficiency than Groq's first-generation 13nm chips.
Groq plans to deploy over 108,000 LPUs by the tip of Q1 2025.
