NVIDIA Inc. NVDA has acquired a stake in Tokyo-based startup Sakanai and plans to become its majority shareholder.
What happened: Sakana AI announced a Series A funding round, raising about 20 billion yen ($137 million), with Nvidia appearing to be the largest investor, Nikkei Asia reported Wednesday.
Founded in July 2023, Sakana AI is the fastest startup to go public as a unicorn in Japan. The company specializes in small-scale generative AI models that are more cost-effective and energy-efficient than the large-scale models of companies such as OpenAI and Alphabet’s Google.
Nvidia’s investment also includes collaboration in research, development and training of AI talent in Japan. “Sakana’s team is accelerating the democratization of AI in Japan by developing cutting-edge foundational models that use Nvidia’s accelerated computing platform to automate and accelerate scientific discovery,” Nvidia CEO Jensen Huang said.
Other investors in the round include U.S. venture capital firms New Enterprise Associates, Khosla Ventures, and Lux Capital. Sakana AI reportedly raised about 4.5 billion yen ($45 million) in January from investors including NTT Group and Sony Group.
Nvidia and Sakana AI did not immediately respond to Benzinga’s request for comment.
See also: Nvidia shares have lost the value of McDonald’s, Disney and Coinbase combined since reporting second-quarter earnings: The AI darling’s fall continues on Tuesday
Why it matters: Nvidia’s investment in Sakana AI comes at a time when the company’s stock price has plummeted, shedding nearly $300 billion in market cap. Despite the downturn, Gene Munster, managing partner at Deepwater Asset Management, remains optimistic about AI’s transformative potential.
Additionally, Jim Cramer recently warned investors not to panic sell NVIDIA shares following a Department of Justice subpoena alleging monopoly practices.
Earlier this year, Nvidia made other significant acquisitions, including buying Shoreline.io for $100 million in June and Run:ai for about $700 million in April.These moves signal Nvidia’s continuing efforts to bolster its AI capabilities and reduce its reliance on major revenue sources such as Microsoft Corp. and Amazon.com Inc.
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This story was produced with Benzinga Neuro and edited by Kaustubh Bagalkote.
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