Pasadena-based graphics processing unit provider Valdi announced on Tuesday it was acquired by Atlanta-based cloud storage company Storj.
Terms of the deal were not disclosed, but the acquisition is another step for Storj to turn into a full stack distributed cloud company.
Both Valdi and Storj are shaking up a space long dominated by veteran Silicon Valley companies that can be hostile to new entrants. Large language models are trained on the troves of data provided by cloud giants like Amazon Web Services, and they need to run on extremely fast and high-powered graphics processing units, or GPUs, famously created by Nvidia.
“Storj was created to build a new cloud for a new era of computing,” Ben Golub, Storj’s chief executive, said in a statement. “About 20 years ago AWS began with S3 object storage (meant to help store and retrieve data) followed by EC2 (Elastic Compute Cloud) CPU-based computing and other services. Today, Storj builds on our strong foundation of distributed cloud object storage.”
This poses a problem for emerging companies looking to tackle this space. Many of them don’t have the capacity to store and use the amount of data cloud companies have access to, and companies looking to train large language models are contributing to a graphics processing unit shortage by buying up powerful chips.
Valdi was founded in 2022 to deal with the GPU shortage in the AI training data space. The company acts as a marketplace where organizations can rent cloud GPUs, which theoretically allows the platform to provide Nvidia-level GPUs at a fraction of the cost. Valdi’s customers include Pasadena-based California Institute of Technology and the University of Southern California’s Marina del Rey-based research firm Information Sciences Institute.
“Validi’s global cloud compute platform enables it to surpass traditional approaches to GPU provisioning, especially when facing unprecedented demand,” Valdi Chief Executive Nikhil Jain said in a statement. “Our customers also have substantial storage needs for their AI workloads.”
As for Storj, the company is working to create a “decentralized” cloud storage system that is both affordable and secure. Instead of owning and operating servers, the company rents a patchwork of storage space from different organizations across the world and provides it to customers. According to Storj, this allows the company to keep costs low and compete with huge cloud companies. To mitigate risks and keep customer information secure, each piece of data is broken into fragments and scattered across different servers.
