Nvidia Corp. (NASDAQ:NVDA) is betting that the future of artificial intelligence lies not in building bigger models, but in running them more efficiently, ramping up investments in inference as the industry pivots to real-world deployment.
The company is backing another fast-growing AI infrastructure startup as investor focus pivots from model training to inference, the process through which AI systems generate outputs in production environments.
Backing Baseten’s Expansion
Baseten, an AI inference startup, raised $300 million at a $5 billion valuation, more than doubling its prior valuation, the Wall Street Journal reported on Tuesday. IVP and CapitalG, Alphabet Inc.’s (NASDAQ:GOOGL) (NASDAQ:GOOG) independent growth fund, led the funding round.
As part of the deal, Nvidia is investing $150 million in Baseten.
Baseten, founded in 2019, helps companies, including AI coding tool Cursor and note-taking platform Notion, deploy and run large AI models.
The company has raised $585 million total, including the new capital.
The investment underscores Nvidia’s growing focus on inference, the process by which AI models generate outputs at scale, as investor interest shifts beyond model training.
Financial Strength and Talent Strategy
Nvidia’s strong balance sheet supports this strategy, with the company holding $60.6 billion in cash, cash equivalents, and marketable securities as of October 26, 2025.
Alongside minority investments, Nvidia has pursued acquisitions to unlock value by securing top AI talent amid rising competitive pressure from Alphabet Inc. (NASDAQ:GOOGL) Google’s in-house chip efforts.
The company has been in advanced talks to acquire AI21 Labs in a deal valued between $2 billion and $3 billion, with insiders saying Nvidia’s primary interest lies in the startup’s roughly 200 highly specialized machine-learning engineers.
The potential deal follows Nvidia’s recent $20 billion agreement with Groq, which centered on transferring elite talent and gaining access to Groq’s language processing unit technology.
NVDA Price Action: Nvidia shares were up 0.63% at $179.19 during premarket trading on Wednesday, according to Benzinga Pro data.
Photo by Michael Vi via Shutterstock
