According to investors, the dominance that the chip company Nvidia has over artificial intelligence (AI) impeded funding for startups.
Moreover, the quarter’s number of deals in the US went down by 80.00% from last year. Regarding generative AI, the California-based firm became solid in that area, making it difficult for others to build competing chips.
Since startups are riskier, venture financiers hesitate to fund them with significant cash infusions. Besides, advancing a chip design to a functioning prototype can cost over $500.00 million.
Eclipse Ventures partner Greg Reichow said the supremacy of Nvidia proved how hard it is to break into the market. As a result, there were several pullback investments into companies.
Other experts reported that US chip startups made $881.40 million through August’s close. It is lower than the $1.79 billion from 2022’s first three quarters.
Another chip startup called Mythic earned $160.00 million but was drained and almost forced to stop operations. However, it brought in around $13.00 million in investments later in March.
Mythic CEO Dave Rick stated that Nvidia indirectly helped the overall AI chip fundraising issues. He added that investors prefer a home run investment with a huge return.
On the other hand, a Rivos spokesperson claimed that Nvidia’s market dominance did not limit its fundraising efforts. Also, its hardware and software still excite investors.
Tata Partners with Nvidia for AI Development
Analysts announced that Nvidia Corporation plans to partner with India’s Tata Group on artificial intelligence. The two companies will build an AI supercomputer powered by its GH200 Grace Hopper Superchip.
According to Nvidia CEO Jensen Huang, the global generative AI race is going well. He added that data centers across the globe are transitioning to GPU computing. Therefore, they could establish energy-efficient infrastructure to support significant generative AI demand.
Also, Huang said India has the suitable size, data, and skills needed for advancing artificial intelligence.
In addition, Nvidia will partner with Reliance Industries. The collaboration would also involve a supercomputer and cloud platforms.
Both companies reported that the AI infrastructure will be open to scientists, developers, and startups.