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Nvidia to buy assets from Groq for $20B cash

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Re: Nvidia to buy assets from Groq for $20B cash

#381

Post by Eridrus »

kasey_junk wrote: post #367
Eridrus wrote: post #358

Earlier quoted context omitted.

Can you say more about why mechanically she didn't get anything? If you exercise your options you have real stock in the company, so I don't see how you can get shafted here. Did investors do some sort of dividend cash out before employees were able to exercise their options? (Obviously shady, but more about investors/leadership being unethical than the deal structure). Would love to know more about how this played o…

Multiple share classes are the norm even before the new acquisition types we see here. It’s extremely common in an acquisition for employee shares to be worth nothing while investor and founder shares are paid out. But these new “acquisitions” aren’t even that. They are not acquisitions at all. They just hire the talent directly with perhaps an ip rights agreement thrown in as a fig leaf.

I'm well aware of dual class shares, but preferences are typically 1x, and none of the deals were for less than the amount raised, so they're not relevant here.

The fact that these are not really acquisitions doesn't change the fact that Groq the entity now has $20b.

Re: Nvidia to buy assets from Groq for $20B cash

#382

Post by Eridrus »

isubkhankulov wrote: post #368
Eridrus wrote: post #358

Earlier quoted context omitted.

Can you say more about why mechanically she didn't get anything? If you exercise your options you have real stock in the company, so I don't see how you can get shafted here. Did investors do some sort of dividend cash out before employees were able to exercise their options? (Obviously shady, but more about investors/leadership being unethical than the deal structure). Would love to know more about how this played o…

There have been at least a half dozen of these deals in the past 1-2 years including Google “licensing” CharacterAI to pull their founders back into Google as valued employees. In the deal mentioned above: my guess is that preferred class shareholders and common shares got paid out but the common shareholders had such a low payout that it rounded down to zero for most employees. This can happen even in a regular acqu…

Liquidation preferences are typically 1x these days, so they only matter when companies are sold at fire sale prices where basically nobody is making any money.

The deals are all weird so it's hard to really know what's happening, but if Groq gets $20b, I don't see how common stock holders don't get paid.

Re: Nvidia to buy assets from Groq for $20B cash

#383

Post by oblio »

oblio wrote: post #334
sigmoid10 wrote: post #313

Earlier quoted context omitted.

As this gets more common, I think it will eventually lead to startups having a hard time attracting talent with lucrative equity compensation. It will be interesting to see how long it takes until this catches on among employees, but I already wouldn't take any positions in startups with a significant payment in equity anymore. The chances are slim that this pays out anyways, but now even when you are successful, noo…

With the job market being in the state it is in, there will always be people wanting to take their chances. Let's face it and accept that the golden days of people working in tech startup (and soon large companies) are over. RIP 1980 - 2023.

LOL@Americans waking up.

I guess you'll have to face the music at some point.

Re: Nvidia to buy assets from Groq for $20B cash

#384

Post by nusl »

_zoltan_ wrote: post #78
nusl wrote: post #32

Legit feels like Nvidia just buying out competition to maintain their position and power in the industry. I sincerely hope they fall flat on their face.

which is exactly what a business should do. it's not like Nvidia doesn't invest a ton into R&D, but hey, they have the cash, why not use it? like a good business.

What a business should do, sure. Businesses should - and do - do a lot of really shitty things because it benefits them but harms a lot of other things. I don't feel that it's a good justification to argue this way though.

In this case, removing a competitor, absorbing their IP, and maintain their ability to dictate the direction of an entire industry. They're hurting the industry itself by removing competition, since competition is good for consumers and also good for progression forward.

Businesses with a monopoly of some sort often stop innovating in the space and end up slowing the entire thing down. Often, they do their best to block anything and anyone that tries to do better, and effectively keep progress back in doing so, simply to maintain their position.

They're selfish self-preserving entities often driven by the same kinds of people, disregarding the harm they do in the name of profits and shareholder "value". Sure, until someone disrupts that (or they get bought out and dissolved).

Re: Nvidia to buy assets from Groq for $20B cash

#385

Post by bdangubic »

nutjob2 wrote: post #379
tormeh wrote: post #320

Earlier quoted context omitted.

Are you sure this is how he'll be remembered? Half the US thought him preferable to AOC and Hillary Clinton. It's hard to conclude in any other way than that the perception of his legacy will be equally divided.

> Half the US thought him preferable to AOC and Hillary Clinton What do those people have to do with anything besides being popular right-wing targets? His approval rating is currently around 42%.

what were his predecessors approval ratings? 42-45% is as good as you’ll ever going to get in America outside or extreme situations like post 9/11.

Re: Nvidia to buy assets from Groq for $20B cash

#386

Post by bdangubic »

crote wrote: post #332
tormeh wrote: post #320

Earlier quoted context omitted.

Are you sure this is how he'll be remembered? Half the US thought him preferable to AOC and Hillary Clinton. It's hard to conclude in any other way than that the perception of his legacy will be equally divided.

Most of his actions are, to the majority of the population, merely transient actions. A few letters on an arts center are trivial to remove, a cancelled wind turbine farm easy to forget. The CECOT stuff deeply impacts only a small part of the population, so it'll at most be a few lines in a history book. But demolishing a third of the White House? That'll be clearly visible in every single aerial shot of the building…

actions might be transient but, like or not (I certainly do not) will be the President that is remembered and talked about more than just about all of previous ones combined

Re: Nvidia to buy assets from Groq for $20B cash

#387

Post by depr »

Eridrus wrote: post #381
kasey_junk wrote: post #367

Earlier quoted context omitted.

Multiple share classes are the norm even before the new acquisition types we see here. It’s extremely common in an acquisition for employee shares to be worth nothing while investor and founder shares are paid out. But these new “acquisitions” aren’t even that. They are not acquisitions at all. They just hire the talent directly with perhaps an ip rights agreement thrown in as a fig leaf.

I'm well aware of dual class shares, but preferences are typically 1x, and none of the deals were for less than the amount raised, so they're not relevant here. The fact that these are not really acquisitions doesn't change the fact that Groq the entity now has $20b.

Groq doesn't keep that money, it goes to VCs. They claim the company is "pivoting", not "selling" and avoid the payout trigger.

Re: Nvidia to buy assets from Groq for $20B cash

#388

Post by SecretDreams »

keeganpoppen wrote: post #376
kasey_junk wrote: post #348

Earlier quoted context omitted.

At my last job search I didn’t consider any equity based startups seriously because of this trend. It was already such a tenuous path as it stood, but now with the norm established it seems like it’s become impossible for a rank and file employee to get paid out. I’m more curious how angel investors are being treated in these exits. If _they_ dry up the whole pipeline goes away

that is a great point. it’s one thing to occasionally rugpull employees, who are still at least paid for their services and robbed only of their EV on their options (i say “only”, though i find this increasingly common practice to be absolutely deplorable, to be clear). but how could investors possibly be happy with this becoming the new normal? will it get to the point where these sorts of faux acquisitions also inv…

> will it get to the point where these sorts of faux acquisitions also involve paying out investors and only shafting employees?

Yes, correct

Re: Nvidia to buy assets from Groq for $20B cash

#389

Post by SecretDreams »

throwawayqqq11 wrote: post #345
oblio wrote: post #334

Earlier quoted context omitted.

With the job market being in the state it is in, there will always be people wanting to take their chances. Let's face it and accept that the golden days of people working in tech startup (and soon large companies) are over. RIP 1980 - 2023.

Looking at GDP, the golden age is still right here. https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?location... /s

Need this plotted against cumulative American debt lol

Re: Nvidia to buy assets from Groq for $20B cash

#390

Post by danielheath »

keeganpoppen wrote: post #376
kasey_junk wrote: post #348

Earlier quoted context omitted.

At my last job search I didn’t consider any equity based startups seriously because of this trend. It was already such a tenuous path as it stood, but now with the norm established it seems like it’s become impossible for a rank and file employee to get paid out. I’m more curious how angel investors are being treated in these exits. If _they_ dry up the whole pipeline goes away

that is a great point. it’s one thing to occasionally rugpull employees, who are still at least paid for their services and robbed only of their EV on their options (i say “only”, though i find this increasingly common practice to be absolutely deplorable, to be clear). but how could investors possibly be happy with this becoming the new normal? will it get to the point where these sorts of faux acquisitions also inv…

20% of 20b isn’t exactly loose change, even for a megacorp.
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