AI chip startup Groq: AI chip startup Groq is valued at $2.8 billion after latest funding round

Semiconductor startup Groq said on Monday that it has raised $640 million in a Series D funding round led by Cisco Investments, Samsung Catalyst Fund and BlackRock Private Equity Partners, among others, raising its valuation to $2.8 billion.

The Silicon Valley firm, founded by a former Alphabet engineer, specializes in producing AI inference chips – a type of semiconductor that optimizes speed and executes commands from pre-trained models.

In addition to large companies like Advanced Micro Devices, many startups, including Groq, have been trying to nibble Nvidia’s dominant position in the booming AI chip industry.

Last year, Groq adapted Meta Platforms’ large language model, LLaMA, so that it could run on its own chips instead of Nvidia’s. Meta researchers created LLaMA using Nvidia chips.

Cloud service providers racing to develop their own AI products are also seeking alternatives to Nvidia’s high-end processors due to high demand but limited supply.

In 2021, Groq was valued at $1.1 billion following funding from Tiger Global Management and D1 Capital.

“Groq will use the funding to expand the capacity of its token-as-a-service (TaaS) offering and add new models and features to GroqCloud,” the company said of the latest funding round. Groq will deploy over 108,000 language processing units manufactured by Global Foundries by the end of Q1 2025.

Groq also announced the appointment of Stuart Pann, a former senior executive at Intel and HP Inc, as its chief operating officer, while Meta’s chief AI scientist Yann LeCun was named its new technical advisor.