Hugging face - from $7Bn to $12.9Bn in 7 months

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In January 2026, Hugging Face - the playground of AI Developers, where they experiment, build things - turned down an investment offer from Nvidia of $500 Mn at $7Bn valuations.
"While declining to comment on Nvidia’s offer, the company said it does not want a single dominant investor that could sway decisions."

Co-founder of Hugging face publically states that concentration of Power is the biggest threat to AI.

7 months later, Reuters report - Nvidia agrees to buy the same playground for $12.9 Bn.
Why?
Hugging face and it's founder, who were against concentration of power and advocated Open models- what changed in those 7 months?

Most people are just labelling it hypocrisy and the increased offer (by $5.9Bn) as a "price" for their stance on AI.

Or is there something more, behind the scenes?

What if the founders saw what's coming and the bid by Nvidia was just to get an established player in its suite rather than building scratch up.

As the competition in the AI space is heating up, the big players are trying to capture different layers of the value chain.

Nvidia already dominating the GPU space, wants to enter into the repository layer, similarly how Microsoft has GitHub - playground for web developers.

For Hugging Face founders - this may have been the best time to exit rather than giving up market share to a big shark. Better a good exit now rather than a great exit that never comes.


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