Nvidia and Snowflake Back Reka AI in $110M Multimodal Bet

Tech giants Nvidia and Snowflake boost AI startup Reka’s multimodal language models through strategic infrastructure partnership

Key Takeaways

• $110 million funding triples Reka AI valuation to over $1 billion as Nvidia and Snowflake lead investment round in the three-year-old startup specializing in large language models
• Strategic partnership strengthens AI ecosystem integration with Reka’s multimodal models being integrated into Snowflake Cortex platform powered by Nvidia’s hardware infrastructure
• Nvidia stock price targets average $183.08 with analysts maintaining “Outperform” rating and GuruFocus projecting potential 63.56% upside to $280.31

Introduction

Artificial intelligence startup Reka AI achieves unicorn status following a $110 million funding round led by tech giants Nvidia Corp. and Snowflake Inc. The investment more than triples the company’s valuation from approximately $300 million to over $1 billion in just two years.

Founded in 2022 by former researchers from Google and Meta, the Sunnyvale-based company develops large language models that claim superior efficiency compared to established competitors. The funding represents the latest surge in corporate investment targeting promising AI technologies as enterprises accelerate adoption of generative artificial intelligence solutions.

Key Developments

Reka AI emerged from stealth mode with a focus on multimodal AI models capable of processing text, images, and video content. The startup’s Core and Flash models reportedly approach performance levels of industry leaders including GPT-4 and Gemini Ultra while emphasizing computational efficiency.

The company expanded its workforce from 20 to 50 employees over the past year as development accelerated. Snowflake previously held acquisition discussions with Reka AI that ultimately concluded without a deal, with both companies choosing to pursue independent growth strategies while maintaining collaborative partnerships.

Reka AI’s technology integrates directly into Snowflake Cortex, enabling customers to deploy advanced AI capabilities within their existing data workflows. The partnership leverages Nvidia’s AI hardware and software infrastructure to deliver enterprise-ready solutions.

Market Impact

The funding round reflects broader investor confidence in AI startups demonstrating technical differentiation and enterprise applicability. Reka AI joins an expanding cohort of billion-dollar AI companies as venture capital continues flowing into the sector at unprecedented rates.

Nvidia maintains its dominant position in AI infrastructure investment, reinforcing market leadership through strategic partnerships with promising startups. The company’s stock faces mixed analyst sentiment with average price targets suggesting modest upside potential from current levels.

Snowflake strengthens its AI platform capabilities through the Reka partnership, positioning itself as a comprehensive data and AI solution provider for enterprise customers seeking integrated workflows.

Strategic Insights

The investment highlights three critical trends reshaping the AI landscape. Large corporations increasingly pursue strategic partnerships with specialized AI startups rather than pursuing direct acquisitions, allowing greater flexibility while securing access to cutting-edge technologies.

Multimodal AI capabilities emerge as a key differentiator as enterprises demand solutions processing diverse data types beyond traditional text-based applications. Companies demonstrating efficiency advantages in model training and deployment attract premium valuations from investors seeking sustainable competitive advantages.

The integration approach favored by Snowflake and Nvidia creates ecosystem lock-in effects, where customers benefit from seamless interoperability between AI models, data platforms, and hardware infrastructure. This strategy positions both companies as essential components of enterprise AI adoption.

Expert Opinions and Data

Vivek Raghunathan, vice president of AI engineering at Snowflake, emphasizes the rarity of independent teams capable of competing with major tech companies. “Very few teams in the world have the capability to build what they’ve built,” Raghunathan states. “Almost everyone at that level of talent is at OpenAI, Meta, or Anthropic. Reka is one of the rare independents — and they’ve proven they can compete.”

Reka AI Chief Executive Officer Dani Yogatama confirms that acquisition discussions with Snowflake concluded amicably, with “both companies deciding it made sense to move independently” while maintaining collaborative relationships.

According to Bloomberg reporting, the investment represents Nvidia’s continued strategy of supporting promising AI startups through direct funding rather than acquisitions. Analyst consensus places Nvidia stock at an “Outperform” rating with average 12-month price targets of $183.08, though GuruFocus projections suggest significantly higher potential returns.

Conclusion

The Reka AI funding round demonstrates how established technology companies leverage strategic investments to secure access to specialized AI capabilities while maintaining competitive positioning. The partnership model enables rapid innovation deployment without the complexities of full corporate integration.

Reka AI’s unicorn achievement reflects investor recognition of technical excellence in AI model development and the premium placed on teams capable of competing with industry leaders. The company’s integration with Snowflake’s platform creates immediate market access while Nvidia’s backing provides essential infrastructure support for scaling operations.