Dealroom: Nvidia is the most active large-scale investor in AI startups in 2023, excluding accelerator funds like YC, with 35 deals, almost 6x more than in 2022
US chipmaker takes stakes in groups that are also its customers in effort to ‘lock up the market’
Context & Ripple Effects
This report establishes an early benchmark for Nvidia's use of startup investing alongside its core chip business: its deal activity rose sharply from 2022 while targeting companies that also buy its technology.
Subsequent coverage shows the approach was not a one-off: Nvidia and NVentures were later counted among the most active corporate AI investors in a broader comparison of tech companies' 2023 AI startup deals, and Nvidia's funding-round activity continued into 2024 in its next year of AI investments.
First-order effects
- AI startups receiving Nvidia capital gain a strategically aligned investor that can also be a major technology supplier and customer-facing partner.
- Nvidia increases its influence over the companies building on its hardware, tying venture deployment more closely to demand for its AI platform.
Second-order effects
- Competing chip and cloud providers face a harder task winning startups whose financing and infrastructure relationships are increasingly connected to Nvidia.
- For founders, capital can come with greater strategic concentration: an investor-supplier relationship may make Nvidia's ecosystem more attractive while narrowing practical alternatives.
Third-order effects
- If this pattern persists, AI infrastructure competition shifts from selling components to financing and cultivating the application layer that consumes those components.
- The result could be a more integrated AI stack, in which startup funding, compute access, and platform choice reinforce one another rather than operating as separate markets.
The trend: Nvidia's startup dealmaking is an early example of compute providers using capital as a tool to secure ecosystem demand and deepen vertical integration.