Lambda Labs, a Nvidia partner, has lost its chief operating officer to a little-known company building hardware for the AI industry.
Lambda COO Mitesh Agrawal told Business Insider he stepped into a new role as CEO of Positron earlier this month. Positron builds hardware for transformer model inference, which is how chatbots like ChatGPT respond to user requests.
Agrawal’s departure is significant given his role in shaping Lambda into one of Silicon Valley’s best-funded and most valuable startups.
During its Series C round last February, the company was valued at about $1.5 billion. Agrawal declined to share the company’s exact valuation but said it has grown to over $2 billion since then.
Agrawal told BI that when he joined Lambda in 2017, the company was focused on building machines for image generation models. This was five years after twin brothers Stephen and Michael Balaban founded it as a company developing facial recognition technology. It wasn’t long after Agrawal’s arrival, however, that the company shifted its focus, designing infrastructure for full-scale data centers and pivoting into cloud services.
He said Lambda’s business now focuses on deploying cloud infrastructure to customers, renting out servers powered by Nvidia’s graphics processing units. It also offers the requisite software, including APIs for inference and machine learning libraries for customers.
Agrawal said that his move to Positron comes amid a growing appetite for inference — the capacity for AI models to apply their training to new data.
Between chatbots like ChatGPT and xAI’s Grok, and new reasoning models like OpenAI’s o1 tackling PhD-level problems, “the curve of technology for inference is just going up, which means the computational requirement is really going up,” Agrawal said. So, he said he’s thinking a lot about “how to solve and how to run these models with as much efficiency as possible.”
He believes Positron is well-positioned to take on that challenge.
Positron was founded in 2023 by Thomas Sohmers, whom Agrawal met in 2015. The two also overlapped at Lambda during Sohmers’s stint at the company between 2020 and 2021. Sohmers, who will move into the role of chief technology officer, told BI that, in simplest terms, the company is “building hardware competing against Nvidia.”
Positron says its hardware outperforms Nvidia’s H100 and H200 GPUs — which fueled the AI race before it released its more powerful Blackwell chips — in performance, power, and affordability.
Going up against a behemoth like Nvidia — which overtook Apple as the world’s most valuable company last week — is no easy task for an up-and-coming company. But by focusing more narrowly on providing hardware for transformer model inference, Sohmers said Positron can differentiate itself from the competition.
Transformer models — neural networks that learn the context and meaning of data to generate new data — are behind some of the most popular generative AI applications. Unlike convolutional neural networks, which underpinned previous decades of machine learning advances, transformer models have greater memory demands. Sohmers said he saw an opportunity to capitalize on those demands.
“I would say the whole reason we started Positron is we thought that there was a better way to do things,” Sohmers said. “Nvidia, as a large company that also has a lot of other product focuses wasn’t going to really optimize and focus on the particular niche that we’re focused on, which is transformer model inference.”
Agrawal, too, is confident in the performance and energy efficiency of Positron’s hardware. Its compatibility with a range of transformer models will also help it attract customers from competitors, he said.
“Nvidia has such a strong ecosystem in the world of AI models. You hear about their CUDA moat, and you heard about the software moat,” he said, referring to the software network the company has built between its products to retain customers.
“What Positron really did was completely remove this friction of anything,” Agrawal said. That means a company can take a model trained on an Nvidia GPU and “run that model’s inference on a Positron card just like you would run on an Nvidia GPU,” he said.
Agrawal said the jump from an established player like Lambda to a young startup like Positron presents an “exciting challenge.”
“You get to compete against an industry veteran as well as in a field that is just so big,” he said.
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