OpenAI sparked Hugging Face bids with early investment offer ahead of Nvidia's…
Hugging Face saw a flurry of deal interest before Nvidia agreed to buy the open-source platform for roughly $13 billion, CNBC has learned.
Spots 
OpenAI offered to invest roughly $100 million in
OpenAI offered to invest roughly $100 million in Hugging Face after the ChatGPT creator's agents hacked into the platform in July. Hugging Face also attracted potential acquisition interest from AMD and Salesforce, sources said.
Before Nvidia agreed to pay roughly $13 billion
Before Nvidia agreed to pay roughly $13 billion to buy open-source platform Hugging Face this month, OpenAI tried to invest $100 million into the startup, according to sources with knowledge of the matter.
Deal discussions between OpenAI began after a high-profile
Deal discussions between OpenAI began after a high-profile hack of Hugging Face in July, when AI agents from the ChatGPT creator broke out of a controlled testing environment, went rogue, and accessed the open web, said the people, who asked not to be named because the talks were confidential.
As part of a potential deal between the
As part of a potential deal between the two companies, Hugging Face would have served as a distribution channel for OpenAI's custom chips, dubbed Jalapeño, which the company is making with Broadcom. The talks fell apart in the early stages, one source said.
Nvidia swept in to purchase Hugging Face, announcing
Nvidia swept in to purchase Hugging Face, announcing the deal on Sept. 3, with CEO Jensen Huang writing in a blog post that, "Together, we will scale Hugging Face's platform, strengthen its infrastructure and expand access to AI for developers and institutions worldwide." It was Nvidia's second-biggest purchase ever, following the $20 billion acquisition of assets from AI chip startup Groq in December.
OpenAI's overture to Hugging Face, especially the semiconductor
OpenAI's overture to Hugging Face, especially the semiconductor offer, got the attention of Huang, who has privately complained about the AI company's move into semiconductors, sources said. OpenAI is a major customer of Nvidia, and has received a $30 billion investment from the chip giant.
Nvidia, which has emerged as a major investor
Nvidia, which has emerged as a major investor across the AI landscape, previously backed Hugging Face in 2023 at a $4.5 billion valuation.
While Nvidia was pursuing Hugging Face, chip rival
While Nvidia was pursuing Hugging Face, chip rival Advanced Micro Devices was also in talks with the company, according to sources familiar with the matter who asked to remain unnamed due to confidentiality. Salesforce was also in early discussions with Hugging Face, according to one person.
The deal eventually landed back with Nvidia. Hugging
The deal eventually landed back with Nvidia. Hugging Face CEO Clément Delangue, who co-founded the company in 2016, said he approached Nvidia because it was "a perfect home" for his company, adding that discussions were fairly swift. "A few weeks later, here we are," Delangue told CNBC's "Squawk Box" on the day of the deal.
News
OpenAI sparked Hugging Face bids with early investment offer ahead of Nvidia's $13 billion deal
Hugging Face saw a flurry of deal interest before Nvidia agreed to buy the open-source platform for roughly $13 billion, CNBC has learned.
@spots #finance #markets
Source: CNBC