A tiny UK company is showing how easy it is to get an (undeserved?) Nvidia halo effect
Step 1: join a free Nvidia program. Step 2: watch stock go up. Step 3: watch stock go down.
UK-based RedCloud Holdings, which operates a business-to-business platform for retailers, nearly doubled at its peak in premarket trading after announcing that “it has joined the NVIDIA Connect program as part of its mission to deliver a new operating system for global trade.”
RedCloud is fairly small, with a market cap of under $70 million heading into Wednesday’s session. Shares are up about 25% as of 9:33 a.m. ET.
What is the Nvidia Connect program, you might ask? Sounds fancy. And official.
The $4 trillion chip designer’s website describes it as “a free program that helps software development companies and service providers shorten time to market through tailored development resources, technical training and guidance, and preferred pricing on NVIDIA technologies.”
In other words, companies learn how to be more effective users (read: customers!) of Nvidia’s products and technology.
RedCloud is hardly the first company to seek a massive spike upon revealing its membership in this club.
However, the vast majority of these jumps were short-lived. With the exception of Stereotaxis, every company on this list proceeded to get crushed after the initial announcement-driven advance.
A cynic might point out that the requirements of joining the Nvidia Connect program are arguably only slightly more onerous than securing a Discover credit card: the applying organization “must provide at least two contacts with corporate emails, maintain a working website, be officially incorporated, and accept the program’s terms and conditions” to be eligible, per Nvidia. There are no application or membership fees.
Still, Jorge Guerrero, assistant vice president of product at RedCloud, made it sound like a pretty big deal in the company’s press release:
“Joining NVIDIA Connect is an exciting opportunity for our development teams. This program provides us with access to NVIDIA’s ecosystem of AI tools and expertise, which we expect to be instrumental in building powerful AI-native infrastructure to enable intelligent trade of FMCG products across global supply chains. Specifically, we are seeking to expand and refine our AI models, improve real-time inference capabilities, and accelerate the deployment of next-generation applications.”
