Nvidia paid $20B for Groq's brain. The body just raised a Series A. August 18, 2026 · 05:11 UTC · News Tl;dr. Groq, the company that spent ten years building LPU inference chips to unseat Nvidia, closed a $350 million round on August 17 that it is calling, with a straight face, a Series A. The round values Groq at $3.5 billion, roughly half the $6.9 billion investors paid last September, and it funds the completion of a total pivot: Groq no longer sells chips. It is now a "neocloud" that rents out inference capacity running on Nvidia hardware, certified as an NVIDIA Cloud Partner on August 12. The lead investor is Disruptive; Nvidia itself has planned participation in the round. That would be the same Nvidia that paid about $20 billion in December for Groq's chip technology and most of its senior leadership. A Series A, ten years in. Groq was founded in 2016 by Jonathan Ross, one of the creators of Google's TPU. Its pitch was the Language Processing Unit: deterministic, SRAM-heavy silicon that served tokens faster than GPUs and made "Groq speed" a real brand among developers. By September 2025 that story was worth a $750 million raise at a $6.9 billion valuation. Eleven months later the same company is closing a "Series A," the round name startups use when they have a product and a pulse. The label is doing deliberate work: it marks the old Groq as over and reboots the cap table narrative around a new business. Per TechCrunch, the round was led by Disruptive, the Dallas firm whose founder Alex Davis now sits as Groq's executive chairman, with Nvidia planning to participate. Combined with June's $650 million raise, Groq has pulled in about $1 billion in two months to fund the rebuild. How to sell a company without selling it. To read this round you need December's deal. On December 24, 2025, Nvidia agreed to pay about $20 billion in cash for Groq's chip assets, the largest deal in Nvidia's history, nearly triple the Mellanox record. Groq framed it as a "non-exclusive licensing agreement." Ross, president Sunny Madra, and other senior leaders joined Nvidia; Groq continued as an "independent company." The structure matters because a merger gets reviewed and a licensing deal mostly does not. It is a bit like selling your house, handing over the keys, and moving out, while the paperwork describes a non-exclusive arrangement to share the kitchen: everything a sale accomplishes has been accomplished, but nothing that triggers a sale's scrutiny has technically occurred. One analyst told CNBC at the time that the deal was structured to keep the "fiction of competition alive." Lawmakers noticed too; the deal drew congressional attention within weeks. What was left behind was GroqCloud, 13 data centers, and a developer base, minus the founder, the president, and the roadmap. Today's round is the market pricing that remainder: $3.5 billion, half of September. From LPU to landlord. The June round started the rebuild: a re-staffed executive bench (COO Alan Rice from xAI and Meta, CTO Sinclair Schuller, CPO Rakesh Malhotra, per TechCrunch's June reporting) and a new identity as an inference neocloud. The August 12 NVIDIA Cloud Partner certification made the hardware direction official: Groq's growth capacity is Nvidia accelerated computing, deployed in Groq's own data centers, sold by the token. The scale, per Groq's own releases: 13 data centers across North America, Europe, the Middle East, and Asia Pacific, more than 6 million developers on GroqCloud, trillions of tokens served weekly, and 54 megawatts of capacity today with a target of more than 200 megawatts in 2027. The LPUs have not vanished; Groq still calls itself "the only team in the world with hands-on experience operating LPUs in production at scale." But the fleet it is raising money to build is green, not orange. Nvidia gets paid three times. Follow Nvidia's position through this arc. It bought the LPU technology and the team that could have commoditized inference, for $20 billion. It now sells Groq the GPUs for a 200-megawatt buildout. And it holds planned equity in the reborn company, bought at half of last year's price. Whichever way inference economics break, Nvidia collects: on the IP, on the hardware invoice, and on the equity. That is not a conspiracy, just excellent positioning, but it is worth naming that the "Nvidia challenger" category lost its most credible silicon entrant and gained another customer. For builders, the practical read is mixed. GroqCloud keeps running, and a funded, expanding host with 6 million developers is better than a zombie. But the thing that made Groq interesting was differentiated silicon with real latency numbers behind it. A neocloud running the same Nvidia racks as CoreWeave, Lambda, and a dozen sovereign clouds competes on price, ops, and contracts instead. The down round is investors saying that difference was worth about $3.4 billion. The caveats. Groq's financials are private; no revenue figures accompany the round. Nvidia's participation is described as "planned" in Groq's own release, not closed. The 200-megawatt figure is a 2027 target, not capacity that exists. And the valuation comparison carries an asterisk in Groq's favor: the September 2025 investors were pricing a chip company whose technology later fetched $20 billion from Nvidia, so "half price" describes the leftover business, not a simple markdown of the same asset. Key takeaways. * Groq closed a $350 million round on August 17 at a $3.5 billion valuation, led by Disruptive with planned participation from Nvidia, and branded it a Series A ten years after founding. * The valuation is roughly half the $6.9 billion Groq commanded in September 2025, before Nvidia's $20 billion December deal took its chip assets, founder Jonathan Ross, and senior leadership. * Groq no longer sells chips: it is now an inference neocloud, certified as an NVIDIA Cloud Partner on August 12, deploying Nvidia hardware in its 13 data centers. * The buildout targets growth from 54 megawatts today to more than 200 megawatts in 2027, serving 6 million developers and trillions of tokens weekly on GroqCloud. * Nvidia ends up positioned on every side of the trade: it owns the LPU technology, supplies the GPUs for the expansion, and plans to hold equity in the new Groq. * The December deal's "non-exclusive licensing" structure, which an analyst said kept the "fiction of competition alive," avoided merger review while removing Nvidia's most credible inference-silicon rival. 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Groq raises $350m, with Nvidia participation "planned" Company value nearly halved following Nvidia license deal August 18, 2026 AI inference company Groq has raised $350 million, at a $3.5 billion valuation. The company develops its own SRAM-heavy inference chips, which it offers from 13 data centers across North America, Europe, the Middle East, and Asia Pacific. The round was led by Disruptive, with "planned participation" from Nvidia. The fundraising comes despite Nvidia licensing all of the company's technology on Christmas Eve last year, in a $20bn deal that also saw the GPU giant hire founder and then-CEO Jonathan Ross, along with president Sunny Madra and other members of the Groq team. Nvidia plans to launch its own Groq-based hardware later this year, and then develop more advanced chips based on Groq, but with an expanded team and utilizing Nvidia IP, including NV Link. The departure of its leadership and the creation of a major rival has impacted Groq's valuation. In September before the deal, Groq raised $650m in a round again led by Disruptive, but at a $6.9bn valuation. "We are building Groq into the world's leading AI inference cloud," Alex Davis, Disruptive CEO and Groq executive chairman, said after this week's round. "We look forward to continuing our partnership with Nvidia at such an important juncture for the ecosystem. Inference will without a doubt become the largest and most critical layer of AI infrastructure. Our team has unmatched experience operating LPUs at scale and delivering the performance, efficiency, and reliability that the next generation of AI demands. We will be focused on supporting the most important model makers to further contribute to the global growth of innovation and American ingenuity." Groq remains an Nvidia Cloud Partner (NCP), certified to design, deploy, and operate Nvidia accelerated computing to Nvidia's reference architecture and operational standards. The company said that it hopes to scale from 54MW of compute to 200MW+ in 2027.

Nvidia to invest in AI chip startup Groq at $3.5b valuation. Groq, a US startup that develops AI chips and operates data centers for AI inference, announce on Aug. 17 that it raised US$350 million at a US$3.5 billion valuation in a round led by Dallas-based investment firm Disruptive. A Groq representative said Nvidia would also invest. The valuation is about half of Groq's US$6.9 billion valuation in September 2025, before Nvidia entered a non-exclusive licensing deal with Groq and hired founder Jonathan Ross and other employees. Since then, Groq has shifted to AI inference infrastructure. Its June 22 US$650 million round was led by Disruptive and Infinitum to expand its inference cloud, and Groq said it operates 13 data centers across North America, Europe, the Middle East, and Asia-Pacific. The company plans to use some of the new funding to expand total capacity to more than 200 megawatts by next year. Groq's June release said the company was led by CEO Adam Winter. Simon Edwards had become CEO after Ross departed under the Nvidia deal. Recent Groq developments. Stay updated on the go with our mobile app. Get latest insights with smoother, more personalized experience through TIA mobile app. How would you feel if you could no longer use Tech in Asia? Share, tag us, and land on our Wall of!