Ever heard what an Acquihire is? It is when a company acquires another company and its talent. Nvidia just spent over $900 million on an acquihire. It acquired Enfabrica and not just any talent from its team, but the CEO (plus others) directly. The deal was closed on September 19, 2025. Well, this is unusual for Nvidia because they invest but never acquire the whole company. Notably, Enfabrica’s technology can connect 100,000+ GPUs (graphics chips) more or less like a giant computer. Does this mean that Nvidia is trying to build complete, ready-to-go AI systems instead of just chips?
What Did Nvidia Do?
Nvidia poured $900 million into two things of Enfabrica:
- To hire Enfabrica’s CEO, Rochan Sankar, and some other employees, too.
- To get hands on Licensing (renting the rights to use) Enfabrica’s technology.
Who Is Enfabrica?
Enfabrica is a U.S. startup founded in 2019. Its technology connects 100,000+ GPUs (graphics chips) so they work like a big computer. Now, such technology is paramount in terms of AI models (for instance, ChatGPT) because they use huge amounts of computing power.
Why Did Nvidia Do This?
- Nvidia’s GPUs are the most popular ones in the AI industry (they are like the backbone). Almost all tech giants like ChatGPT, Gemini, Claude, and more run on their chips.
- These GPUs are like shelves full of chips put together.
- The more the chips, the more powerful the tech is, but putting them together is tough (the more the chips, the harder it gets to work them out).
- Enfabrica’s technology has the efficiency to solve this problem. Nvidia can now scale up AI supercomputers. So, yes, Nvidia can sell a complete, ready-to-go AI system instead of just chips.
How Does This Fit Into Nvidia’s History?
Past acquisitions:
- In 2019, Nvidia bought Mellanox, spending $6.9B → It’s a networking technology that is backing Nvidia’s Blackwell chips.
- In 2022, Nvidia failed to buy Arm for $40B because of regulators.
- In 2024, it bought Run:ai for $700 million, and it optimizes AI workloads for Nvidia.
Recent investments:
- Just a few days ago (September 17, 2025), Nvidia invested in U.K. startup Nscale’s data centers.
- Now (September 18, 2025), a whopping $5B stake in Intel to partner and develop AI processors.
How Does This Compare to Other Tech Giants?
So why do companies acquire (buying talent + tech)? Basically, to avoid legal and regulatory risk. Nvidia is not alone; several others are following the same business strategy, like:
- Meta put $14.3B on Scale AI founder + team, took 49% stake on June 13, 2025.
- Google spent about $2.4B on the Windsurf founder + team on July 11, 2025.
- In August 2024, Google acquired the Character.AI team.
- Microsoft onboarded a team from Inflection AI in March 2024.
- Amazon hired a team from Adept AI on June 28, 2024.
Why Is This Important for Nvidia?
The AI race is picking up its pace, and Nvidia wants to win it with the best chips + best computing talent.
- Nvidia is making sure:
- To onboard the best engineers.
- To own the networking tech and connect big clusters of GPUs.
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