Wall Street giants are reportedly investing large sums in an artificial intelligence firm, valuing it at a multi-billion-dollar valuation.
AI chip startup Groq, which builds and deploys custom hardware called Language Processing Units (LPUs) has raised $750 million at a post-funding valuation of $6.9 billion, Bloomberg reports.
The funding round was led by late-stage tech investment firm Disruptive, with “significant investment” from BlackRock, Deutsche Telekom Capital Partners and Neuberger Berman.
Participants also included a “large US-based West Coast mutual fund,” Groq said in a statement to Bloomberg.
The company says it will use the money to scale its data center capacity, including new locations this year and next, according to CEO Jonathan Ross.
Ross also says Groq will announce its expansion into the Asia-Pacific region later this year.
“We’ve had customers come to us asking for more capacity than we can satisfy at the moment.”
With AI leading the stock market charge over the last year, some investors are becoming skeptical if the run is sustainable.
Billionaire investor and hedge fund manager Leon Cooperman recently said in a CNBC interview that a potential artificial intelligence (AI) bubble could be one of the catalysts that could trigger a correction in the US stock market.
“Either AI being discredited or maybe showing not to be that economic. Or recession. It doesn’t look like a recession in the near term. The economy is slowing.
I think that with every third word on TV being AI… You have to be a little concerned about AI being overpromoted.”
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