Nvidia challenger Groq is set to double its valuation to $2.5 billion in fresh funding round led by Blackrock

The new financing has yet to be finalized and terms could change. The deal would more than double what Groq was valued at when it raised $300 million in a 2021 round led by Tiger Global Management and D1 Capital Partners, according to Pitchbook data. The company has raised a total of $367 million.

Groq was founded in 2016 by former Google executive Jonathan Ross to provide chips designed for inference — to process AI that has already been deployed rather than training new models. It has advertised its chips, dubbed “language processing units,” as more than 10 times as fast as conventional ones and one-tenth the cost.

Groq is competing with Point72-backed SiMa.ai, Microsoft-backed Dmatrix and Intel-backed Untether.AI, just to name a few of the hardware inference companies battling to take on Nvidia, which briefly became the most valuable company in the world last week before a steep sell-off. Another Nvidia rival, Cerebras, reportedly filed for an IPO confidentially, according to The Information.

Groq’s latest funding round was part of an unusual dispute at Social Capital, the venture firm founded by well-known investor and podcaster Chamath Palihapitiya. He fired two partners in March after accusing them of trying to raise outside money for Groq, which Social Capital first backed eight years ago.