Nvidia Invests $7 Billion in Poolside for Open-Weight AI

Nvidia Corp. has entered into a $7 billion agreement with AI startup Poolside to develop open-weight AI models under the Nemotron project. The deal includes $6 billion to license Poolside's models and a $1 billion equity investment, valuing the startup at $12 billion. As part of the arrangement, Nvidia is hiring 109 Poolside employees, though Poolside's leadership will remain independent.

The initiative aims to create an American alternative to Chinese open-weight models from rivals such as DeepSeek and Moonshot, which are often more customizable and cheaper to operate than proprietary U.S. models. Poolside specializes in AI that automates computer coding, particularly for government and defense software.

CEO Jensen Huang argues that U.S. AI leadership depends on a strong, open ecosystem rather than a few closed frontier models, which he claims can be breached or misused. This strategy places Nvidia in direct competition with other U.S. firms it supports, including OpenAI and Anthropic. The deal structure mirrors a previous $20 billion license agreement Nvidia made with Groq, a pattern that has drawn criticism from lawmakers who suggest such deals are used to bypass formal merger reviews.