The resignation heard around the world
Jensen Huang, Nvidia's embattled CEO who co-founded and led the company for 33 years, has officially stepped down. "It's like a bomb went off," one neocloud founder told TechCrunch upon hearing the news.
Over the past several years, Nvidia has been a prolific investor, pouring tens of billions into startups annually and participating in 105 rounds this year alone—often as the largest investor, according to PitchBook. "If that direction changes, it'll be a big blow to so many young companies," said Maria Davidson, founder of Relational Capital.
A champion gone, and capital with him
Huang's absence leaves the startup ecosystem without one of its biggest champions—and, for now, with far less capital. Investors say the shift could have a massive impact on dealmaking, valuations, funding, and even competition.
"Nvidia is carrying almost every AI-native startup from application to neocloud," Dawn Capital's Shamillah Bankiya told TechCrunch.
Many of the most significant investment decisions came from Huang himself, according to Umesh Padval, managing partner at Seligman Ventures. Padval has known Huang since serving on the board of Mellanox Technologies, a networking chipmaker Nvidia acquired for approximately $7 billion in 2020. While there is hope that Huang's eventual successor will resume his dealmaking spree, investors aren't optimistic it will happen in the short term.
A more conservative interim regime
Nvidia's interim CEO, Colette Kress, is expected to institute changes—particularly regarding Nvidia's investments in AI startups at the heart of the billion-dollar data center build-out. Huang's rampant dealmaking in this sphere had been a source of concern for Wall Street.
"She's much more conservative," one investor said of Kress. "I don't think she's going to commit the same amount of money to keep the early-stage ecosystem going."
The bets that built an ecosystem
Nvidia's biggest bets backed neoclouds, inference providers, and open-weight models—categories that are expensive for smaller companies to build. "Jensen's initiatives are a big reason an ecosystem has emerged despite that," said Zain Javaid, co-founder of the hardware company Ghost.
For instance, Nvidia backed CoreWeave when it was still private and participated in two of Crusoe's rounds, including its $1.4 billion Series E. It agreed to buy Hugging Face this year for $13 billion (expected to close in 2027) and holds investments in Mistral AI, Lambda, and Black Forest Labs. Nvidia was often the largest investor in these deals. Last year, it wrote an $800 million check into a $2 billion Series B round for Reflection AI—before the open-source startup began to earn meaningful revenue, according to The Wall Street Journal.
A global gap no one can fill
"Jensen believed in open source and, frankly speaking, Europe," Bankiya said, explaining how Huang spread AI investment across the world. The end of that support in regions outside the U.S., such as Europe, "would be a massive funding—and, honestly, ecosystem—gap that no one can fill."
via TechCrunch AI