AI chip startup Groq is reportedly raising $650M from existing investors to grow its inference cloud business, following a $20B technology licensing deal with Nvidia.
Chipmaker Groq is looking to raise $650 million in internal funding as it pivots from hardware to focus more on AI inference, the process of refining the way AI models respond to prompted requests, per Axios.
# After Nvidia's $20B not-aqui-hire, AI chip startup Groq reportedly raising $650M | TechCrunch
Source: [https://techcrunch.com/2026/05/29/after-nvidias-20b-not-aqui-hire-ai-chip-startup-groq-reportedly-raising-650m/](https://techcrunch.com/2026/05/29/after-nvidias-20b-not-aqui-hire-ai-chip-startup-groq-reportedly-raising-650m/)
In Brief
Posted:
10:27 AM PDT · May 29, 2026
**Image Credits:**Nuthawut Somsuk / Getty Images[Groq](https://groq.com/)is looking to raise $650 million in new funding from existing investors, sources tell[Axios](https://www.axios.com/2026/05/28/groq-650-million-nvidia), as it leans into its inference neocloud business that relies on its homegrown AI chip and systems\.
In December, Groq struck one of those not\-an\-acquisition agreements with Nvidia for[a reported $20 billion](https://www.cnbc.com/2025/12/24/nvidia-buying-ai-chip-startup-groq-for-about-20-billion-biggest-deal.html), which involved the departure of some top\-level senior Groq employees to the chip giant and the licensing of Groq’s hardware technology to Nvidia\. That deal was good news for the startup’s investors, who got paid out in cash with what would have been Nvidia’s largest purchase, if the deal was a full\-acquisition, Axios reports\.
Now these investors have been asked to pony up and back the company’s plans to grow its inference cloud business, which lets developers and enterprises host their inference\-hungry apps\. Inference is the processing that happens after an AI prompt and is currently a much bigger need in the AI world than model training\.
The new direction is led right now by Groq’s interim CEO and CFO, Adam Winter and Matt Eng, respectively\.
In some ways, the $650 million in funding is guaranteed\. Axios reports that Groq’s backers Disruptive and Infinitium have agreed to fill the round should other existing investors not want their pro\-rata shares\.
### Newsletters
Subscribe for the industry’s biggest tech news
## Related
## Latest in AI
Groq raises $650M to pivot to its neocloud business after Nvidia's $20B licensing deal and talent poaching, hiring new executives and expanding data centers.
Groq raised $350 million at a $3.5 billion valuation after Nvidia licensed its technology and hired its senior team, pivoting to an inference cloud operation using both its LPUs and Nvidia systems.
Groq is raising $650M despite its technology licensing to Nvidia because the corporate entity retained its datacenter operations and inference API, focusing on fast small-model inference.
Groq raises $350M to pivot from AI chip manufacturing to neocloud services, providing GPU-based AI infrastructure, with Nvidia's involvement valuing the company at $3.5 billion.
NVIDIA is integrating Groq technology into rack-scale products to enhance agentic AI performance by splitting workloads across specialized processors, improving token generation latency and overall responsiveness.