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Nvidia's $20B antitrust loophole

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Re: Nvidia's $20B antitrust loophole

#101

Post by jcheng »

spiantino wrote: post #87
Salman23 wrote: post #51

Earlier quoted context omitted.

Yes I think you are right here. The purchase price is high enough for all parties to be get return on their shares, and whilst there will be a waterfall for who gets paid first, I doubt many people will be unhappy with this deal. Unlike Windsurf... who's 2nd employee only got 1% of what their shares were worth ( https://news.ycombinator.com/item?id=44673296 )

i thought so at first, but I did some digging and changed my mind. it's possible the following is how it goes: - secondary transaction with the preferred shareholders (VCs) at some price that implies a 20b valuation - founders quit and get new employment agreements - some cash is transferred to the company as a license fee - no acquisition means no DOJ approval in this scenario the headline can be $20b but the cash e…

To make this right they’d just have to amend the first part to “secondary transaction with shareholders at some price that implies a 20b valuation”.

Has there been any evidence yet that the VCs got paid for their shares but the left behind employees didn’t?

Re: Nvidia's $20B antitrust loophole

#102

Post by tomhow »

irishcoffee wrote: post #77
altairprime wrote: post #61

Earlier quoted context omitted.

Regulations shouldn’t have to change with every new fintech innovation, and the IRS already has the necessary laws in place to catch and prosecute abuse of unpredicted loophole technicalities as tax fraud with intent. We’re better off applying a general tax to “gross revenue not paid as wages” and directing it to a universal basic income fund. The purchase price is gross revenue, and the less they pay out as employee…

[flagged]

This comment is not cool, and is not welcome on HN.

You had a history of guidelines-breaking comments and moderator warnings up until a few years ago, and we've not seen any comments from you until the past month or so, and now you're back into those bad old patterns. You are of course welcome to participate here. But this is only a place where people want to participate because we have clear guidelines, and most people take care to observe them. Please do your part to raise standards here rather than dragging them downward.

Re: Nvidia's $20B antitrust loophole

#103

Post by colechristensen »

websiteapi wrote: post #27

I wonder how the startup scene will adjust to this if it becomes mainstream. can employee contracts be modified to force compensation even in this case? seems difficult to write one up without weird second order effects. if this does end up being something that is legal and successfully circumvents anti trust, does it mean antitrust actually is a failure in practice? 2026 hasn't even begun and more shenanigans are in…

This won't last. It's just creative regulatory evasion and the loopholes will get closed.

Re: Nvidia's $20B antitrust loophole

#105

Post by rynn »

CalChris wrote: post #59

What is keeping Google/Amazon/Microsoft from licensing Groq’s tech? Sans people to be sure but at substantially reduced price. The Groq Cloud people should owe no allegiance to Ross. BTW, the FA says Nvidia bought the patents. That’s probably an overstatement. Grow said non-exclusive licensing and Nvidia hasn’t said anything. I think Nvidia licensed the IP and ‘bought’ (handcuffed) the people.

>What is keeping Google/Amazon/Microsoft from licensing Groq’s tech?

Nothing, but they likely can't implement it as well as they could had they bought Groq first.

Re: Nvidia's $20B antitrust loophole

#106

Post by makeitdouble »

websiteapi wrote: post #33
tonyhart7 wrote: post #31

Earlier quoted context omitted.

if we use your logic then every law written would be failure since at some point people would discover loophole/flaw that would get abused the fix is we use more ambiguous words or just stronger government control see how China "control" capitalist on this case if you want absolute government control

isn't it true though that laws that have frequently abused loopholes that effectively go against the spirit of the law are indeed failures? isn't that the entire purpose of having lawmakers who are constantly evaluating such things?

You could see it as a failure to enforce the spirit of the law. Judges have the power to make it right and refuse the loopholes.

Re: Nvidia's $20B antitrust loophole

#107

Post by Draiken »

MrGilbert wrote: post #69
bilbo0s wrote: post #62

Earlier quoted context omitted.

That’s just it. We’ve entered a new era. Big companies don’t need your startup. They only need your smart guys. Just those few guys. You keep the rest of your engineers and figure out what to do with them. And lately, the answer has been, “wind it all down”. This sucks so bad for most of their employees. But it’s a signal to the labor market: Be very honest about what you are when you’re considering working at an AI…

> But it’s a signal to the labor market: Or... Maybe we should start to think about how we let corporations get bigger and bigger? What happens if an entity (read: company) becomes so valuable, that it is basically indestructible? Does it have the power to change politics to their discretion? And as such, also influence the legislative? I find that highly concerning.

You mean like Google/Apple/Meta already are?

I don't see how we're not already there. There's no competition, only an oligopoly splitting their spoils.

Re: Nvidia's $20B antitrust loophole

#108

Post by manquer »

atif089 wrote: post #56

> GroqCloud will wind down over 12-18 months. They'll either get laid off or jump ship to wherever they can land. They built the LPU architecture, contributed to the compiler stack, supported the infrastructure, and got nothing while Chamath made $2B. This is depressing.

Unlike other SaaS "acquisitions" of late, this will be not as straightforward closure of a subscription business.

The $1.5B contract with the Saudi Arabia is substantial and investors will want that monetized too, there are also existing DCs GroqCloud have in the ME region and also other spots around the world that are quite valuable for their hardware and power agreements etc.

Nvidia has CIFUS and other regulatory concerns and also don't want to compete against their customers be a neo cloud provider, the Saudis likely still want their DC build outs to proceed.

All this to say, the remaining parts while no longer as glamorous is still worth a lot and cannot be easily sold to big tech co. GroqCloud is more be like Nokia Technologies/ Networks rather be killed.

---

As a result, staff not part of the Nvidia deal likely have solid jobs and also now the opportunity to climb the ladder quickly now that a lot of leadership positions have opened up.

They are also going to have to be compensated higher in cash or poached by an upcoming chip startup as they are no longer tied to equity options vesting scheduled of a very valuable company (Pre deal Groq or now Nvidia).

In any scenario they will come out better of the deal, not as much they could have in a full acquisition yes, but certainly better than most engineers not working for a hyped AI startup nonetheless.

Re: Nvidia's $20B antitrust loophole

#109

Post by SilverElfin »

paxys wrote: post #98

This has nothing to do with antitrust. Not like the current administration is going to enforce it anyways. Nvidia simply wants Groq’s tech and leadership without the burden of 500+ employees.

Nvidia should still pay the 500+ employees their due, based on their percentage of ownership.
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