Nvidia has agreed to acquire Hugging Face, the open-source AI platform, in a deal worth $12,930,300,000—roughly $13 billion, according to a blog post announcing the agreement. While not the largest sum the AI industry has seen, the price represents a striking startup exit for a company founded in 2016 by three French entrepreneurs living in New York City, who named their venture after the 🤗 emoji. Over the following decade, Hugging Face grew into a trusted repository for AI developers, hosting hundreds of thousands of openly available models—including widely used releases such as Meta's Llama family and Mistral's models—that have become foundational infrastructure for researchers, startups, and enterprises building AI without licensing closed systems.

"It's been a wild ride for Hugging Face," cofounder Thomas Wolf said on X. "We certainly did not anticipate, back in 2016, as a tiny team of scrappy underdogs, that the field would grow so much or that the impact we could have on it would become so massive."

The deal also underscores how important open-weight models—the kind Hugging Face hosts on its platform—are to Nvidia's future business. As closed-source AI heavyweights that have been major Nvidia customers, including OpenAI, Microsoft, Amazon, and Meta, develop their own chips to reduce reliance on Nvidia GPUs, the company views open-weight models as a core future revenue stream. Owning the platform where much of the open-weight ecosystem distributes its work gives Nvidia a direct line to the developers and enterprises that download, fine-tune, and deploy those models—a distribution position that rivals cannot easily replicate.

For Hugging Face, backing from Nvidia could mean major growth. The platform currently has 18 million individual users and 200,000 enterprise clients, Nvidia told reporters. "Our goal is to get to 100 million AI builders in the next few years, and we think with the support of Nvidia, we have more chances to get there faster," Hugging Face CEO and cofounder Clément Delangue said.

But while Nvidia and Hugging Face stand to profit handsomely, the individuals who created and listed models on the platform have not seen a dollar. "It's unfortunate [Hugging Face] never found a way for us to monetize our creations," Eric Hartford, creator of the open-weight model Dolphin, Chief Scientist of lazarusaie.com, and founder of quixi.ai, told Fortune. "If I got a dollar for every download of Dolphin I'd be rich."

Hugging Face turned down Nvidia in the past. Why now?

Nvidia has had its eye on Hugging Face for years. It participated in the company's 2023 Series D funding round, which valued Hugging Face at $4.5 billion, TechCrunch reports. Last year, Hugging Face turned down a $500 million investment offer from Nvidia that would have valued it at $7 billion, because the investment would have made Nvidia the company's largest minority shareholder and the founders wanted the platform to keep its independence, according to The Financial Times. The gap between that $7 billion valuation and the roughly $13 billion acquisition price reflects how quickly the strategic value of open-weight platforms has grown as the AI race has intensified.

So why did the two companies agree to a deal now? In a briefing with reporters, Delangue did not confirm the $500 million offer, and said previous reporting on the company's fundraising can be "quite far from reality" since Hugging Face never publicly comments on it.

"The truth is that throughout the life of Hugging Face, we always got quite a lot of offers for acquisitions that we turned down in the past," Delangue said. "I think this summer the planets aligned…we increasingly were convinced that Nvidia would be the perfect home for us, and so our confidence grew tremendously, and we decided that it was the best thing to do for Hugging Face, but also for the field and for AI in general."

Delangue was likely referring in part to a letter on the importance of open-weight models signed by Nvidia CEO Jensen Huang, which became his first X post. "Open models strengthen safety and cybersecurity, accelerate innovation and diffusion, and enable sovereignty," the letter said.

Also this summer, Hugging Face gained broader mainstream name recognition after OpenAI's models hacked into its repositories during training. That episode boosted the company's brand recognition, creating conditions that helped coax a major offer out of Nvidia.

Can Hugging Face stay neutral, or will its models now favor Nvidia hardware?

The big debate now raging in the AI industry is whether Nvidia's acquisition will subtly influence the open-source ecosystem to favor its hardware. Model creators could choose to build their models for Nvidia hardware, especially if doing so makes it easiest to launch them on Hugging Face and for others to use them. The question matters beyond Hugging Face's own users: because so much of the open-source AI community treats the platform as default infrastructure, shifts in how models are surfaced, optimized, or supported there can ripple across the broader ecosystem.

Nvidia said Hugging Face "will remain an open platform" in which developers can freely choose the models, frameworks, and computing platforms that they want. "Nvidia compute will not be required to build on or deploy through Hugging Face," the company said.

However, some observers say there is already a suspicion that Hugging Face is subtly biased toward Nvidia, and that the acquisition is likely to accelerate that tilt.

"Hugging Face runs a giant library called Transformers, which is the gatekeeper for model releases," Hartford said. "Though they have had a natural bias for Nvidia due to its overwhelming popularity, they haven't been unnaturally biased, or mis-incentivized. With Nvidia ownership that all changes. They will still be the gatekeepers, and they will be unnaturally incentivized to favor Nvidia and disfavor Nvidia's competitors. Not because of a conspiracy theory, but [because of] the dynamics of ownership."

Nvidia also offers its own open models and data on Hugging Face, and says it is "the largest contributor" on the platform, offering "more than 500 models" and "more than 250 open datasets." As the platform's new owner, it could now advertise those models on Hugging Face and gain more users.

There is also a more optimistic reading for the business world. Open-weight models offer more customization and transparency than closed alternatives from the likes of OpenAI or Anthropic. The acquisition could make it easier for organizations that are open-source-curious to finally take the plunge, opening up new ways to use AI. Regulators and competitors will be watching how the deal is reviewed and implemented—particularly whether Hugging Face's commitments to platform neutrality hold once it operates inside one of the industry's dominant hardware suppliers.

This story was originally featured on Fortune.com.