Groq, an American artificial intelligence startup is allegedly developing chips that can run generative AI models faster than usual. As reported on Monday, due to a funding round led by Blackrock, the company has raised $640 million. Other ventures such as Neuberger Berman, Type One Ventures, Cisco, KDDI, and Samsung Catalyst Fund also participated in this round.
Therefore Groq has raised over $1 billion while the company aimed at raising only $300 million. Currently, the company is valued at $2.8 billion. This is a mega success for the company as it is more than double the value of the previous year’s valuation which was at $1 billion in April 2021.
At the time, the company had raised $300 million led by Tiger Global Management and D1 Capital Partners.
Groq is creating a language processing unit or LPU that they claim can run existing generative AI models similar in architecture to OpenAI’s ChatGPT and GPT-4o at 10x the speed and one-tenth the energy. Besides, Jonathan Ross, the CEO of Groq is helping invent the TPU or the tensor processing unit, Google’s custom AI accelerator chip used to train and run models.
GroqCloud, an LPU-powered developer platform provided by the company offers “open” models like Goggle’s Gemma, OpenAI’s Whisper, etc., and an API that allows users to use its chips in cloud instances.
Groq has more than 356,000 developers as of July, and the portion of its proceeds from the round will be utilized to add new models and features. The company also hosts an AI-powered chatbot called GroqChat, which was launched in late 2023.
Due to the growing demand for AI, the company faces major competition with rival AI chip upstarts and Nvidia. Nvidia which controls approximately 70% to 95% of the AI chips market is taking aggressive steps to continue its dominance in this realm.
Other than Nvidia, Groq’s competitors are Amazon, Google, and Microsoft, all of whom currently offer or plan to offer customized chips for cloud-based AI workloads.
However, Groq is investing heavily in government outreach and enterprises. With the acquisition of Definitive Intelligence in March, Groq formed a new business unit called Groq Systems, which offers AI solutions for business.
As part of Groq Systems’ mission, the company serves organizations that wish to add Groq’s chips to existing data centers or build new data centers using Groq processors. By the end of 2025, Groq plans to deploy over 108,000 LPUs.
