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Nvidia is in discussions to invest about $2.5 billion in Thinking Machines Lab, the AI startup founded by former OpenAI executive Mira Murati. The startup is simultaneously negotiating a funding round of $5 billion to $6 billion at a valuation of at least $40 billion, with Accel leading the effort. The potential investment would build on a March partnership under which Thinking Machines committed to deploy at least 1 gigawatt of Nvidia’s Vera Rubin systems. The talks follow Nvidia’s agreement to acquire Hugging Face for $12.93 billion and reflect a broader strategy of investing across the AI ecosystem. A deal is not guaranteed to close.
Key Elements
Nvidia Corp. (NVDA) is negotiating a roughly $2.5 billion investment in Thinking Machines Lab, the artificial intelligence startup founded by former OpenAI executive Mira Murati, a move that would deepen the chipmaker’s push beyond hardware into the companies driving demand for its processors.
The startup is simultaneously in talks to raise between $5 billion and $6 billion at a valuation of at least $40 billion before the new capital arrives Nvidia’s contribution would account for roughly half of that round
A deal is not guaranteed to close, the report cautioned.
The discussions build on an existing relationship that already goes well beyond a typical venture bet. In March, the two companies announced a multiyear partnership under which Thinking Machines committed to deploy at least 1 gigawatt of Nvidia’s next-generation Vera Rubin systems, with the first rollout targeted for early next year.
That arrangement makes Nvidia’s potential investment strategically distinct: the chipmaker would be helping finance a company that has already pledged to run its infrastructure at enormous scale. For Thinking Machines, the capital provides the computing capacity needed to build and serve advanced AI models. For Nvidia, it reinforces future demand for its systems while giving the company a stake in one of the more closely watched startups in the field.
The talks come just after Nvidia agreed to acquire open-each into software and developer tools. The chipmaker has backed more than 100 AI startups over the past two years including positions in OpenAI and Anthropic as well as AI data and cloud firms
The pattern is consistent: Nvidia is using its <a href="https://bitcomme.com/el-paso-school-district-shares-financial-updates-and-concerns/” title=”El Paso school district shares financial updates and concerns”>financial strength to invest in companies that could become major customers for its chips and data center systems, moving beyond selling hardware into helping fund the ecosystem that consumes it.
Thinking Machines, less than two years old, released its first AI model, Inkling, in July. The company is working with existing backer Accel to lead the funding round, according to the report.
The proposed valuation represents a step down from late last year, when the startup explored raising between $4 billion and $5 billion at a valuation exceeding $50 billion.
Wall Street analysts remain broadly bullish on Nvidia, with 30 buy ratings and an average price target of $322.44, implying more than 40% upside from current levels. Individual targets range from $250 to $465.
Still, the rising pace of deal spending and the increasingly tight relationships between Nvidia and its AI customers carry risks that investors will be watching as the company’s investment portfolio expands alongside its core chip business.
The next catalyst is whether Nvidia and Thinking Machines finalize the funding round and disclose how the investment fits into their existing gigawatt-scale partnership.
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