Tech giants go big: Alphabet, Nvidia invest in OpenAI co-founder Sutskever’s startup- Report | Company Business News

Alphabet and Nvidia have joined major venture capital firms in backing Safe Superintelligence (SSI) — a startup co-founded by former OpenAI chief scientist Ilya Sutskever.

Within months of its launch, the SSI rapidly became one of the most valuable AI startups, and was recently valued at $32 billion, reported Reuters, citing sources aware of the matter.

Tech giants go big on AI

The funding illustrates renewed interest from the big tech and infrastructure providers in making strategic investments in the startups developing cutting-edge AI that requires massive amounts of computing power.

Alphabet, which has its own AI models, earlier in the week announced a dealby its cloud computing arm to sell SSI access to tensor processing units (TPUs), its in-house AI chips.

SSI valued at $32 billion

SSI, which sources say was recently valued at $32 billion in a round led by Greenoaks, is one of the highest-profile startups working on AI model research, thanks to Sutskever’s stellar track record in predicting the next big thing in AI development.

Like many of its competitors, it has a huge demand for chips.

There was however, no information on the exact terms of Alphabet’s and Nvidia’s investment in SSI, reported Reuters.

The twin moves by Alphabet’s corporate and cloud division with high-profile AI labs including SSI and Anthropic show the tech giant’s evolving AI hardware strategy.

Google’s strategy

Google originally reserved TPUs for in-house use. The deal to sell SSI chips in significant quantities to support its frontier AI research exemplifies the company’s ongoing strategy to expand sales to external customers, Darren Mowry, a managing director in charge of Google’s partnerships with startups, said in an interview with Reuters this week.

“With these foundational model builders, the gravity is increasing dramatically over to us,” he said.

AI developers have historically preferred Nvidia’s graphics processing units, which hold more than 80% of the AI chips market.

But SSI is so far primarily using TPUs rather than GPUs for its AI research and development, two sources said.

Google offers both Nvidia GPUs and its own TPUs through its cloud service. Its own chips are intended to excel at specific AI tasks and are more efficient than general-purpose GPUs. These chips have been used to build large-scale AI models, such as Apple and Anthropic, an OpenAI competitor that has received billions of dollars of funding from Google and Amazon.

Amazon a challenger for Google and Nvidia?

Google and Nvidia also face a challenger in Amazon, which is building its own competing processors called Trainium and Inferentia. Amazon has said as far back as 2023 that Anthropic would develop its technology on those chips. The tech giantannounced in December that Anthropic would be the first customer to use a massive supercomputer powered by hundreds of thousands of its own chips.

In the meantime, Anthropic continues to use TPUs for its AI development and has not decreased spending on Google’s chips, two sources said.

It is increasingly common for major cloud providers to invest heavily in AI startups that not only build foundational models but also serve as significant customers of their infrastructure. For instance, Amazon and Google have both invested in Anthropic, while Microsoft has placed substantial bets on OpenAI. Nvidia has also backed OpenAI, as well as Elon Musk’s xAI.

(With inputs from Reuters)