Andreessen Horowitz has an enormous cluster of Nvidia H100 GPUs to assist its portfolio of AI startups meet their compute wants, the enterprise capital agency confirmed for the primary time on Wednesday. This system, known as “Oxygen”, permits their portfolio firms to coach or function their AI fashions with out negotiating market charges.
A16Z’s Oxygen cluster offers startups some respiration room, so to talk, to compete in opposition to bigger tech firms – similar to Google, Meta, and Microsoft – in constructing massive AI fashions. For the previous a number of years, these firms have been engaged in a bidding battle for GPUs, particularly the AI industry-standard H100s, typically profitable offers by promising bigger and longer contracts. That leaves a number of AI startups out to dry, since they could not have the ability to tackle the massive contracts essential to safe GPUs, whereas the OpenAIs and Anthropics of the world can.
“This began from a realization that quite a few the AI founders we serve daily had a typical downside: We had been in the course of a provide crunch, the place Nvidia H100 capability was in brief provide,” stated A16Z accomplice Anjney Midha, who helped create the Oxygen program, in a podcast transcript shared with TechCrunch. “As startups, they had been being deprioritized by the big clouds in favor of bigger clients, which was actually powerful for them.”
The infrastructure can also be a great way for A16Z to draw new startups. Firms constructing AI fashions typically want unfettered entry to large compute clusters for brief coaching runs, however then, don’t want them as soon as the fashions are skilled. Inferencing AI fashions sometimes requires much less compute than coaching, except after all, utilization of an AI mannequin explodes. A16Z’s Oxygen cluster gives startups flexibility, giving entry to GPUs after they want it, and not using a long-term dedication to a cloud supplier or large money outlay. As a substitute, they offer A16Z a stake of their enterprise, in trade for (amongst different issues) low costs to hire GPUs.
However A16Z aren’t the one traders promising startups founders GPUs, on high of economic capital and steering, for stakes of their firms. Investing companions Nat Friedman and Daniel Gross provide their startups entry to a 4,000 GPU cluster dubbed the Andromeda Cluster, in keeping with Forbes. Y Combinator additionally gives startups a cluster of GPUs for coaching runs by partnerships with varied cloud suppliers, most just lately, Google Cloud.
An Andreessen Horowitz spokesperson declined to touch upon how massive the Oxygen cluster is, nevertheless, A16Z could have the biggest GPU battle chest of any enterprise agency. The Data reported in July that Oxygen might include greater than 20,000 GPUs.
At one level within the podcast, Midha says the Oxygen cluster can relieve stress on AI startups to fundraise at overpriced valuations with a view to pay their compute payments. That’s one other means Oxygen advantages A16Z. As a substitute of investing extra in a startup so it may possibly purchase GPUs from say, Microsoft, A16Z can provide the GPUs themselves and make investments at a lower cost.
A16Z views Oxygen as a core worth proposition to its startups transferring ahead, so long as the AI growth continues as projected. That’s probably why the startup made the huge funding required to safe these chips.
