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CoreWeave raises $7.5 billion debt for AI infrastructure expansion

Specialized cloud services provider CoreWeave is raising $7.5 billion in debt from financiers led by Blackstone and Magnetar Capital to scale up its infrastructure to meet rising artificial intelligence workloads, it said on Friday.

The deal is one of the largest debt financing rounds for a startup and adds firepower to CoreWeave’s balance sheet as it looks to double its number of data centers to 28 this year.

“The caliber of investors in this large debt financing round is a powerful testament to … the insatiable market appetite for AI infrastructure,” CEO and co-founder Michael Intrator said.

Nvidia-backed CoreWeave has raised more than $12 billion in equity and debt investments over the past 12 months, including a $1.1-billion series C investment led by private equity firm Coatue earlier this month.

CoreWeave was valued at $19 billion in that round, according to a person familiar with the matter.

Coatue, Carlyle Group, Canada’s CDPQ, DigitalBridge Credit, funds managed by BlackRock, Eldridge Industries and Great Elm Capital were also part of CoreWeave’s latest debt raise.

CoreWeave has seen a boost from businesses rapidly adopting generative AI technology. It has partnerships with AI startups and competing cloud providers to build clusters to power AI workloads.

The company has access to the most advanced Nvidia chips that are in short supply, giving it an edge over hyperscalers such as Amazon Web Services, Microsoft’s Azure and Google Cloud.

Hyperscalers are cloud providers with a large network of data centers and wide range of services, and are often preferred for end-to-end workload support.

Amazon, Microsoft and Google-parent Alphabet posted strong growth for their cloud units in the most recent quarter, underscoring higher spending by customers. CNA

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