Nvidia is in advanced discussions to acquire Israeli artificial intelligence startup AI21 Labs in a deal that Israeli business media has reported could be valued at between two and three billion dollars. The acquisition, if completed, would be structured primarily as an acquihire — a deal focused on absorbing the company's roughly 200-person team of AI researchers and engineers rather than a straightforward purchase of a business generating significant revenues.
AI21 Labs, founded in 2017, became one of Israel's most prominent AI companies through its work on large language models and its commercial Jurassic model series. The company positioned itself as an enterprise-focused alternative to OpenAI and Anthropic, emphasizing controllability, privacy, and on-premise deployment options for business customers. It raised a total of $208 million across its funding rounds, most recently extending its Series C in late 2023 at a valuation of $1.4 billion.
The Funding Round That Never Was
The acquisition talks come against an unusual backdrop. For much of 2025, AI21 was widely described in industry and business reporting as having raised a $300 million Series D backed by Nvidia and Google — a round that would have further cemented its position as a leading independent AI company. However, reporting by CTech, the technology news arm of Calcalist, subsequently revealed that the round was never formally closed and never reflected in the company's capital structure. AI21's last confirmed raise remains the 2023 Series C extension.
Whether described as an acquisition or a talent transaction, what Nvidia wants here is obvious: a team of world-class AI researchers who have been working on language model development since before the current generation of interest in the field.
Nvidia's interest in AI21 reflects the chip giant's broader effort to move up the AI value stack beyond hardware. Nvidia's processors power the vast majority of AI model training globally, but the company has increasingly sought to build or acquire capabilities in software, model development, and enterprise deployment — areas where owning world-class talent directly accelerates its ambitions.
AI21 Denies the Reports
AI21 Labs issued a formal denial of the acquisition reports, stating that while it values Nvidia as a business partner and investor, "reports of negotiations for a possible acquisition are incorrect" and that "the company has not held discussions with Nvidia about an acquisition." The denial follows a pattern common to acquisition processes in the technology industry, where companies routinely deny ongoing discussions until a deal is formally signed.
Israeli business newspaper Globes and the Jerusalem Post both reported the talks as ongoing, citing multiple sources familiar with the matter. The contradiction between the company's denial and the sourced reporting has left the situation unresolved, with market observers watching for further signals from either party in the coming weeks.