Nvidia Continues Torrid AI Startup Investment Pace, Outstripping Microsoft And Google

Just last month Lambda, which offers computing services and hardware for training artificial intelligence software, raised a $480 million Series D that reportedly valued the company at $2.5 billion.

That same day, Together AI, a developer of a cloud platform to allow developers to build on open and custom artificial intelligence models, raised a $305 million funding round at a $3.3 billion valuation.

What the rounds had in common was one investor: chip giant Nvidia.

That should come as little surprise to anyone who has watched AI funding in the last two-plus years since Microsoft agreed to a multiyear, multibillion-dollar investment into OpenAI — the first and loudest shot in the artificial intelligence arms Big Tech would begin to play.

Nvidia continues to outpace other huge AI players such as Microsoft and Google both in terms of funding rounds it participates in for AI startups, and the total value of those rounds. (It is impossible to say how much Nvidia invested in most rounds as a specific stake in a round is not usually divulged.)

Let’s take a look at what these three tech titans — who have been the most curious when it comes to VC-backed startups in AI — have done in the past year-plus.

Nvidia

Just last year, Nvidia took part in 26 rounds that totaled $18.8 billion, per Crunchbase data. That far outpaces its two dozen deals in 2023, which totaled $4.5 billion.

However, to be fair, that dollar total is bloated since the chipmaker took part in xAI’s $6 billion round in November and OpenAI’s massive $6.6 billion deal in October.

Aside from those deals, Nvidia also took part in London-based self-driving car startup Wayve’s $1.1 billion round, and data labeling and evaluation startup Scale AI’s $1 billion round that valued it at a stunning $13.8 billion, both in May.

What may be most impressive about Nvidia’s AI investing is how it is driving its overall corporate investment strategy. In 2022, Nvidia invested in nine funding rounds, per Crunchbase. In each of the past two years, it has participated in 36 a year.

The company’s venture arm, NVentures, also has been active — although on a much smaller scale. Last year it took part in 14 investments, with those rounds totaling $89 million, per Crunchbase data. That’s slightly ahead of 2023, when the investment arm participated in 11 deals that totaled $824 million.

Microsoft

Perhaps surprisingly, the same cannot be said for Microsoft.

Last year, the Redmond, Washington-based tech giant took part in nine investments in AI startups, with those rounds totaling nearly $10 billion, per Crunchbase data. That was slightly behind 2023, when it participated in a dozen deals that totaled $12.2 billion.

Some of Microsoft’s biggest deals actually overlap with Nvidia, as it also took part in both the previously mentioned rounds for OpenAI and Wayve, as well as massive fundings for Figure and Bright Machines.

However, the Windows maker also made headlines when it poured a $1.5 billion strategic investment into United Arab Emirates-based artificial intelligence firm G42.

The company’s venture arm, M12, has continued to keep up a pretty consistent pace. Last year, the firm took part in 10 funding rounds that totaled $268 million, per Crunchbase data. Similarly, in 2023 it took part in 9 deals totaling $442 million.

Microsoft has not shifted back to heavily investing in VC-backed startups this year yet, only taking part in a small pre-seed round for GuidenAI.

Google

While Microsoft’s slight dip in AI funding might be surprising, Google’s drop is extremely eye-catching.

The search giant saw its corporate investing drop by two-thirds, being part of only four deals that totaled $3.2 million, per Crunchbase data. Its biggest round was co-leading CharacterX’s $2.8 million seed round.

In 2023, Google took part in a dozen rounds totaling nearly $3.6 billion.

On the flip side, its venture arm, GV, was quite active last year, taking part in 22 deals that totaled a whopping $1.5 billion, per Crunchbase data. That includes being part of a $250 million Series E for Vercel, a platform that allows companies to develop web applications in the cloud. The new round valued the startup at $3.25 billion.

GV also was part of a $400 million Series D for Lightmatter, a startup that uses light to link chips together and to do calculations for the deep learning necessary for AI. The round valued the company at $4.4 billion.

Shifting strategies?

Unlike Microsoft, Google seems to be ramping back up. In January, the search giant invested another $1 billion into Anthropic. Previously, Google had invested $2 billion into the OpenAI rival.

Then last month, Google participated in AI-powered humanoid robotics company Apptronik’s massive $350 million Series A co-led by B Capital and Capital Factory.

While Google and Nvidia still seem keen on investing in the startup world, Microsoft’s complex relationship with OpenAI — both a partner and competitor that seems to be cozying up to the likes of SoftBank and Oracle — and its retreat in 2024 seem to indicate the tech giant is more focused on internal development.

It also seems clear Nvidia will continue to invest in and push this current AI ecosystem — one which it feeds and dominates with its high-performing chips.

Regardless of changing strategies, these three AI players still are bringing a lot of cash to the table for startups looking to make a name for themselves in the AI space.