How to invest in Groq pre-IPO
The AI boom has gotten so big that there are now two high-profile AI players with names that sound the same — Grok, the generative AI application from xAI, which is integrated into X (formerly Twitter) — not to be confused with Groq, an AI chip company that is raising significant funds and carving out a path for itself amidst large competitors like Nvidia.1
While xAI and its flagship offering Grok has significant pre-IPO buzz, Groq is also attracting investors who want to try to get in early. For now, Groq has not announced any plans to go public, but the company completed a large Series D in 2024 and continues to make waves, such as through partnerships with Meta2 and Saudi oil giant Aramco.3
So, accredited investors who want a slice of this action may consider investing in Groq pre-IPO through a secondary marketplace such as Forge. Or, investors, including retail ones, might look for indirect exposure, such as via companies that have invested in Groq or by investing in publicly traded competitors who could benefit from growth in the overall AI sector.
Here, we'll take a closer look at how to invest in Groq stock pre-IPO.
Groq: Company background
Groq was founded in 2016 by Jonathan Ross, who had previously led a project that would become Google’s Tensor Processing Unit (TPU), which are Google's own chips that it uses for large AI models internally.
Some main competitors like Nvidia sell graphics processing unit (GPU) chips that were originally built for purposes such as video games but are now used to run AI models. Groq, however, sells what it calls language processing unit (LPU) chips, which the company says provides faster, more affordable, and more energy-efficient AI processing capabilities.4
Specifically, Groq's hardware — and now its expansion into software — focuses on the area of AI inference, which is when AI models make predictions or decisions based on new data they take in. In contrast, some other AI semiconductor companies focus on chips that can be used to run workloads that train AI models. So, there's some overlap between Groq and other AI chip companies, but Groq also has its unique selling points.
With its focus on AI inference, for example, Groq announced a Memorandum of Understanding in September 2024 with Aramco Digital, a subsidiary of Saudi oil giant Aramco, to build the world's largest AI inference data center.5
Groq has also expanded into areas such as offering tools for developers. Its partnership with Meta includes running Meta's Llama 3.1 large language model on the GroqCloud Dev Console and GroqChat (the latter of which can be used to build chatbots).6
However, much remains to be seen regarding if/how Groq will fully capitalize on the AI boom. According to Forbes, Groq only had $3.4 million in revenue in 2023, with a net loss of $88.3 million.7
Groq stock and funding history
Since its founding, Groq has raised just over $1 billion through primary funding rounds. Groq’s Series A in 2016 raised over $10 million at a valuation of $35.58 million and a stock price of $0.97 per share.8
In 2018, Groq’s Series B brought the stock price up to $6.76 and a valuation of nearly $350 million. By 2020, Groq reached unicorn status, raising nearly $225 million for its Series C, with Groq’s stock price rising to $11.54 at a $1.33 billion valuation.9
In 2024, Groq's Series D raised $640 million — about twice what the company planned to raise10 — bringing its stock price up to $16.08 and its valuation more than doubling to $2.81 billion.11
Groq's Forge PriceTM rose to $17.50 in mid December but dropped to $16.96 a few days later.12 Forge Price is a derived data point that reflects the up-to-date price performance of venture-backed, late-stage companies, and is calculated based on a proprietary model incorporating pricing inputs from primary funding round information, secondary market transactions, and indications of interest (IOIs) on Forge.
How to buy Groq stock
Since Groq is a private company, its stock is not for sale to the general public. While it's possible Groq will conduct an IPO in the future, Groq has not publicly indicated any plans to do so.
As such, investment in Groq in the pre-IPO stage is generally limited to institutional investors or high-net-worth individuals selected to participate in primary funding rounds; also, accredited investors can potentially buy stock from existing shareholders through a secondary marketplace such as Forge, subject to availability.
Who can invest in Groq pre-IPO?
To invest in Groq pre-IPO, along with any other private company, you typically have to either be an institutional investor or high-net-worth individual selected to participate in primary funding rounds, or you have to be an accredited investor who can find Groq stock for sale on a secondary marketplace, such as Forge.
Where to buy pre-IPO Groq stock
Accredited investors may be able to buy pre-IPO Groq stock through a secondary marketplace such as Forge, depending on availability. However, trading on a secondary marketplace like Forge requires existing shareholders, such as early employees, to list their shares for sale. Private companies typically have a right of first refusal (ROFR) to buy shares before they are listed on secondary marketplaces, so availability can be limited.
That said, those who are interested in investing in startups such as Groq pre-IPO may wish to create an account with Forge and speak with a Private Market Specialist to stay informed about whether pre-IPO Groq stock becomes available through Forge.
Alternatives for unaccredited investors who want to buy Groq stock
While investing in private companies through a secondary marketplace is limited to accredited investors, that doesn't mean retail investors are fully unable to invest in Groq — it just might not be direct. Instead, retail investors can invest in publicly traded funds and companies that either have some exposure to Groq or operate in similar spaces, thus potentially benefitting from the same AI boom.
For example, some of Groq's investors include BlackRock and Cisco Investments.13 While most people likely do not have access to Groq shares directly through BlackRock Private Equity Partners, BlackRock itself is a publicly traded company, and thus investing in BlackRock stock provides some exposure, albeit a small, indirect amount. The same goes for investing in Cisco stock, although Cisco, as a tech company, arguably has a more direct correlation to Groq stock performance.
Similarly, retail investors could allocate to other publicly traded AI companies that could potentially move in the same direction as Groq. Nvidia, for example, despite being a competitor of Groq, could gain value if the same underlying currents that spur demand for Groq chips also cause more companies to buy Nvidia chips. Other publicly traded tech companies like Meta, Alphabet, Amazon, and Microsoft could similarly provide correlated exposure.
How to analyze Groq stock
Financial data on private companies like Groq is generally much more limited compared to data on public companies, so Groq stock analysis can be complicated. However, using publicly reported information such as Groq's revenue, customers and partnerships, and funding rounds could provide investors with a general idea on the value of the company. Comparing Groq's valuation to other startups trading on private marketplaces like Forge could also help, as could comparing Groq to publicly traded semiconductor companies.
Granted, it's hard to make direct, objective comparisons based on the limited data, and investors need to keep in mind that private companies like Groq generally have higher risk than public companies do. Limited liquidity, transparency, and history can all affect the valuation of a company like Groq compared to other AI-related stocks.
Get started investing in Groq on Forge
If you seek to invest in Groq pre-IPO if/when shares become available, create an account with Forge Markets to access our deep marketplace of private market securities.
When you create a free account, you'll be connected with a Forge Private Market Specialist to determine your eligibility, and from there you can potentially buy and sell private market shares in Groq and other startups.
Forge stands out for its transparency into what can otherwise be an opaque private market, and as a publicly traded company itself, Forge provides a regulated, proven way to invest in the private market.
FAQs about investing in Groq
Where do I buy Groq stock?
Investing in Groq pre-IPO is generally limited to those chosen to participate in primary funding rounds, such as venture capital firms, although accredited investors could potentially find shares for sale through a secondary marketplace such as Forge, depending on if existing shareholders list there.
Who can invest in Groq?
As a private company, the general public cannot invest in Groq, unless the company were to engage in something like a crowdfunding round or an eventual IPO. Instead, investment is generally limited to institutional investors or high-net-worth individuals that Groq accepts as primary funding round participants; or, if existing shareholders like early employees decide/are able to list shares for sale on a secondary marketplace like Forge, then accredited investors may be able to invest in Groq stock pre-IPO.
Who are Groq's competitors?
Groq's competitors include other AI chip companies such Nvidia, AMD, and Cerebras. Groq could also potentially be considered a competitor of companies like Google and Amazon if these companies decide to sell their proprietary AI chips to other companies in the future.
