> I don't understand how market regulators allow this.
The US government is literally for sale. Businesses know that this window is limited and are executing antitrust manuvers left and right while they can.
The writing style here is so belittling, and frankly stupid.
E.g. "billion is so big!", uh, I've heard of a billion before, and then comparing the value of a company to a single person's salary, as if that was very relevant.
> Then in maybe one of the best rug pulls of all time, in July they quietly
changed their valuation to $500 million. A 75% cut in four months. I’ve
never seen anything like that since the 2008 financial crisis.
Not sure where the author is getting their information from but there is seemingly little correlation between the investment rounds quoted in this post and other online sources. No mention for example of the Series E that valued Groq at $6.9bn.
> To visualize $1.5 billion: if you cashed that check out in $100 bills and stacked them one on top of another, it would reach a five story building. For ordinary plebeians like us, at the average US salary of around $75K, you’d need to work 20,000 years to earn that.
The bubble take is tired. This was regulatory arbitrage: IP licensing instead of acquisition to dodge CFIUS/antitrust. The $13B premium to avoid years of hold up while enriching Chamath and giving Trump's AI Czar a Christmas present. So many other things at play here than just "AI bubble so big it will boom".
You are missing the point that it is a strategic acquisition to kickstart a new vertical that they have struggled with: serving inference. They have tried to organically grow this and do weird things like inference within their other customers’ clouds.
It certainly isn’t a “panic” as nvidia is so flush with cash. This is a minuscule amount of money for them.
My understanding is Groq failed to deploy their second-gen chips on time, which caused their stock to deflate.
Groq's primary advantage over Cerebras and SambaNova, as I see it, is they don't fabricate on TSMC. That's attractive to Nvidia, who doesn't want to give up any of their datacenter GPU allocation.
Why do you think? Not because of any output of the company, of course.
But because buying it helps perpetuate the hype and money cycle of the 'AI' trend for awhile longer. It may not look like it directly, but a purchase like this keeps Nvidia's stock up in the future, which is all investors care about.
> About a year ago, Groq announced a $1.5 billion infrastructure investment deal with Saudi Arabia. They also secured a $750 million Series D funding round.... Then in maybe one of the best rug pulls of all time, in July they quietly changed their revenue projections to $500 million. A 75% cut in four months. I’ve never seen anything like that since the 2008 financial crisis.
Not following the core argument here. Author seems to be comparing valuation in funding rounds to revenue projections. Revenue projection was revised downward, valuation was not.
Good point about not running the proprietary models, but that doesn't preclude strategic fit with Nvidia.
> At that time, the company was valued at $2 billion. Hello bubble. Then in maybe one of the best rug pulls of all time, in July they quietly changed their revenue projections to $500 million. A 75% cut in four months.
B) All info the OP(= author) knows is known to the professionals dealing with the due diligence. They decided to do so while looking at data which is not available the public. So assuming they know some things why we don’t know is not a far fetched idea.
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[ 2.9 ms ] story [ 57.8 ms ] threadsorry, not corruption! retainer fees and timely stock purchases. different thing!
The US government is literally for sale. Businesses know that this window is limited and are executing antitrust manuvers left and right while they can.
E.g. "billion is so big!", uh, I've heard of a billion before, and then comparing the value of a company to a single person's salary, as if that was very relevant.
Not sure where the author is getting their information from but there is seemingly little correlation between the investment rounds quoted in this post and other online sources. No mention for example of the Series E that valued Groq at $6.9bn.
— A motivational speaker, probably
Revenue targets are meaningless, especially in hyped fields.
No, we don't need to visualize that.
A 4x for an AI cloud+infra play that targets speed and cost? Where do I send the check?
If NVIDIA believes it can take this and scale it, $20b is a no brainer.
Here's my take on what actually happened: https://ossa-ma.github.io/blog/groq
It certainly isn’t a “panic” as nvidia is so flush with cash. This is a minuscule amount of money for them.
My understanding is Groq failed to deploy their second-gen chips on time, which caused their stock to deflate.
Groq's primary advantage over Cerebras and SambaNova, as I see it, is they don't fabricate on TSMC. That's attractive to Nvidia, who doesn't want to give up any of their datacenter GPU allocation.
One of them will surely be right eventually!
But because buying it helps perpetuate the hype and money cycle of the 'AI' trend for awhile longer. It may not look like it directly, but a purchase like this keeps Nvidia's stock up in the future, which is all investors care about.
Not following the core argument here. Author seems to be comparing valuation in funding rounds to revenue projections. Revenue projection was revised downward, valuation was not.
Good point about not running the proprietary models, but that doesn't preclude strategic fit with Nvidia.
I feel like I'm missing something here…
https://claude.ai/public/artifacts/8c395eb5-8d22-431f-b6ba-0...
B) All info the OP(= author) knows is known to the professionals dealing with the due diligence. They decided to do so while looking at data which is not available the public. So assuming they know some things why we don’t know is not a far fetched idea.