Nvidia Eyes $2–3B AI21 Talent Acquisition

Chipmaker Nvidia is in advanced discussions to acquire Israeli AI startup AI21 Labs in a deal estimated at $2–3 billion, according to reports. If completed, the transaction would significantly exceed AI21’s last known valuation of about $1.4 billion from its 2023 funding round and would be driven primarily by talent acquisition rather than technology.

AI21 recently raised around $300 million in a round led by Nvidia and Google, though the company never officially disclosed its valuation. While Google had earlier explored a potential acquisition, talks with Nvidia have reportedly accelerated in recent weeks and reached senior leadership levels.

Nvidia’s main attraction appears to be AI21’s roughly 200-strong workforce, composed largely of highly trained AI researchers and engineers. At the implied valuation, the deal would amount to an effective cost of $10–15 million per employee—highlighting the premium placed on elite AI talent and suggesting an “acquihire” structure.

Founded in 2017 by Professor Amnon Shashua, Professor Yoav Shoham, and Ori Goshen, AI21 was once seen as Israel’s answer to frontier model developers like OpenAI and Anthropic. However, intense competition and rapid industry advances forced a strategic pivot. The company shut down its consumer product Wordtune earlier this year and now focuses on enterprise-grade language models emphasizing accuracy and reliability. Its flagship product, Maestro, claims to improve model accuracy by up to 50%, but revenues are estimated at around $50 million annually.

For Nvidia CEO Jensen Huang, the deal would further expand Nvidia’s footprint in Israel, following earlier acquisitions including Mellanox. While modest relative to Nvidia’s cash reserves, the move underscores a clear strategy: securing scarce AI talent as competition in chips and models intensifies.