AI Chip Startup Groq Raises $750M at $6.9B Valuation
bloomberg.com
bloomberg.com
Artificial intelligence chip startup Groq Inc. raised $750 million at a post-funding valuation of $6.9 billion, highlighting investor interest in companies seeking to alleviate a shortage of chips and computing power for AI workloads.
The round was led by Disruptive, with “significant investment” from Blackrock Inc., Neuberger Berman Group LLC and Deutsche Telekom Capital Partners, as well as existing investors including Samsung Electronics Co., Cisco Systems Inc., D1 and Altimeter. Participants also included a “large US-based West Coast mutual fund,” Groq said in a statement.
The company will use the funds to expand its data-center capacity, including new locations this year and next, according to Jonathan Ross, chief executive officer. Groq plans to announce its first Asia-Pacific location this year, he said.
Nvidia Corp., which dominates the market for processors that train AI models, is trying to keep a large lead in the market for inference — running models once they have been developed. Startups including Groq and companies like Alphabet Inc.’s Google are developing their own rival chips and in some cases selling computing services that use them.
“We’ve had customers come to us asking for more capacity than we can satisfy at the moment,” Ross said in an interview. Groq, which sells chips and data-center computing power fueled by its processors, operates 13 facilities in the US, Canada, Europe and the Middle East. The company powers some of the Saudi AI company Humain’s services, including the newly released Humain chat product, according to Ross. Groq also supported the release of OpenAI’s GPT-OSS model in Saudi Arabia.
The company has expanded its capacity by more than 10% in the last month and all of that is already in use, Ross said. He declined to say how much capacity the company has in total.
The funding round was originally closed at about $600 million. Groq asked investors to reopen it for additional participants. Details of that deal were reported earlier by Bloomberg and the Information.
The Information reported in July that Groq had slashed more than $1 billion from its revenue projections for 2025. A person familiar with the matter said Groq expected the revenue that was trimmed from its projections this year to be realized in 2026, Bloomberg reported in July. Ross declined to comment on sales.