It’s not just tech startups — consumer & retail brands are getting snapped up too, like Pepsi’s $2B acquisition of Poppi.
But tech is leading the charge.
M&A activity in the sector rebounded 5% in 2024 and we expect it to gain more steam this year thanks to several factors:
Less regulatory pressure: Big tech players like Google are betting on a friendlier dealmaking climate with Lina Khan out as head of the FTC.
AI boom: Incumbents are anxious to get their hands on AI assets and infrastructure (see ServiceNow’s acquisition of Moveworks and SoftBank’s acquisition of Ampere).
Cheaper prices: Tech M&A valuations keep falling, encouraging strategic and financial buyers to get off the sidelines.
Nvidia's M&A playbook
Among the Mag 7, Nvidia stands out for its aggressive acquisition strategy.
All told, Nvidia has snapped up 7 AI startups since 2021, with 4 of these in just the last year.
Last week it bought Gretel, with reports placing the exit valuation north of $320M (Gretel’s last disclosed valuation) but less than $1B.
Per CB Insights’ ESP ranking, Gretel is a leader in the synthetic training data market.
By acquiring Gretel, Nvidia positions itself at the forefront of the synthetic data market and strengthens its position in emerging areas like physical AI.
Back in June 2024, we wrote about how Nvidia is investing in and partnering with companies focused on industrial applications, like digital twins and robotics, which can rely on AI for simulation and training.
Fake it ‘til you make it: AI startup 11x, backed by a16z and Benchmark, is under fire for allegedly faking customer logos and inflating revenue. ZoomInfo and Airtable say they were wrongly listed as clients — and one is threatening legal action. Ex-employees say the product was buggy, customers bailed fast, and the work culture was brutal. 11x denies wrongdoing and says retention is up.
Risk relativity:Chamath Palihapitiya just revealed a $380M loss on his investment in Relativity Space after a major recapitalization that saw Eric Schmidt swoop in with a ~$3B check (according to Chamath) and take over as CEO. The former Google chief is now running the rocket startup, aiming to turn it around and compete with SpaceX. Relativity’s early rocket failed after launch, and its plans to reach Mars have been delayed — but Schmidt’s betting big on a comeback.
Source: X
Testin’ Teslas:YouTuber Mark Rober put Tesla’s vision-only system to the test against a car equipped with lidar — and per Rober, the Tesla failed to detect obstacles like fog, bright lights, and even a cartoon-style fake road. But critics say the test doesn’t prove much. Tesla diehards are calling Rober's video dishonest, saying Rober used Tesla's older Autopilot system, not its newer "Full Self-Driving" (FSD) tech.
iSue:Apple’s being hit with a class-action lawsuit over delays to its hyped “Apple Intelligence” features. Plaintiffs say they bought iPhones expecting cutting-edge AI tools — only to get nothing or a watered-down version. The lawsuit claims Apple misled consumers with its marketing. Meanwhile, CEO Tim Cook has shaken up Apple’s AI leadership, replacing the exec in charge with someone new to get Siri and Apple Intelligence back on track.
Smile, you’re on camera:Clearview AI, the facial recognition company known for scraping billions of photos from the web, tried to buy 690M arrest records — including Social Security numbers and mugshots — from intelligence firm Investigative Consultants Inc. for nearly $1M. The deal fell apart, and Clearview is now suing to get its money back. Critics say combining scraped images with personal data could fuel bias and surveillance.
Chip check:Malaysia is cracking down on Nvidia chip shipments after pressure from the US to stop high-end semiconductors from slipping into China. Washington suspects that some chips meant for local data centers are being quietly rerouted despite export controls. The move comes after a $390M fraud case in Singapore involving Nvidia servers.
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