BlackRock (BLK)-backed chip startup Groq has raised $750 million in new funding, more than doubling its valuation to $6.9 billion.
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Groq, set up in 2016, provides fast AI inference in the cloud and in AI compute centers. It is best known for producing AI inference chips that optimize pre-trained models.
Funding Surge
Its last funding round was in August last year, when it raised $640 million that brought its valuation to $2.8 billion.
The latest round was led by Disruptive, with significant investments from BlackRock, Neuberger Berman, Deutsche Telekom Capital Partners and a large U.S.-based West Coast mutual fund manager, Groq said.
Disruptive, a Dallas-based growth investment firm that has backed companies such as Palantir (PLTR) and Spotify (SPOT), has invested nearly $350 million in Groq.
The round also included Samsung (SSNLF), Cisco (CSCO), D1, Altimeter, 1789 Capital and Infinitum.
The industry is increasingly shifting focus to hardware designed for inference, from the training-centric chips that characterized the early period of AI development. In many ways AI is evolving from the brains to the muscle and bone.
Leading AI chipmaker Nvidia (NVDA), as well as Advanced Micro Devices (AMD), are both reportedly gearing up to offer more inference-focused chips.
Inference Interest
Larry Ellison, chief technology officer at Oracle (ORCL) (below), recently described inference as a “multi-trillion-dollar market,” pointing to its potential in fields from robotics to drug design.
Indeed, it is being driven by surging demand for real-time processing in generative AI, autonomous systems, and edge computing. So much so that the global AI inference market is projected to grow from $97.24 billion in 2024 to $253.75 billion by 2030.
“Inference is defining this era of AI, and we’re building the American infrastructure that delivers it with high speed and low cost,” said Jonathan Ross, Groq founder and CEO.
Groq also secured a $1.5 billion commitment from Saudi Arabia in February to expand the delivery of its advanced AI chips to the country.
The startup has told investors that the contracts in Saudi Arabia will help bring in about $500 million in revenue this year.
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