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Why Clément Delangue Sold Hugging Face to Nvidia After Turning It Down

After years of resisting major outside investment, Hugging Face is joining Nvidia as open-source models gain momentum against proprietary rivals.

As of a few months ago, Hugging Face CEO Clément Delangue was still reluctant to have a single dominant investor in his company, which hadn’t raised outside funds in more than two years. “We don’t need to raise too much money, and we’ve decided not to in the past few years,” Delangue told Observer in June. Most notably, Hugging Face turned down a $500 million investment offer from Nvidia last year. The tables have turned 180. After over a week of speculation and reported talks, Hugging Face is now selling itself in its entirety to Nvidia for $12.9 billion, Nvidia announced today (Sept. 3).

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The amount is nearly three times Hugging Face’s last private-market valuation three years ago. And it’s Nvidia’s second-largest acquisition on record, after its $20 billion purchase of chipmaker Groq in December.

In a joint........

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