CoreWeave placed a bet back at the start of the cloud boom in 2017 that niche computing capabilities for articificial intelligence (AI) and other workloads would play an important role in the market going forward. That bet paid off this month in the form of a $221 million fundraising round, driven in large part by a spike in demand for compute resources capable of powering generative AI services like ChatGPT.
“We believe that democratizing access to GPUs will continue pushing the AI/ML industry forward,” CoreWeave CEO Michael Intrator told Silverlinings.
Intrator said the company is different from cloud giants like Amazon, Microsoft and Google in that it caters to a handful of specific use cases which require a certain level of compute power. These include AI, machine learning, visual effects, batch processing and pixel streaming.
All of these, he explained, rely on graphics processing units (GPUs) to help speed processing, but GPUs are difficult to maintain, expensive and in high-demand. That means there are often hurdles to securing GPU processing from generalized cloud providers, whether that’s in the form of high costs, long wait times, limited availability or a lack of technical support.
These are the problems that CoreWeave is – and has been – trying to solve. The company has dug deep into the GPU niche since its founding six years ago and now offers more than 11 different kinds of GPUs from NVIDIA, allowing clients to select a GPU based on both their workload and budget.
“Because we specifically cater to the needs of our AI, machine learning, visual effects, batch processing and pixel streaming clients, we can offer customized solutions built for those workloads that are ultra-performant in scale, speed and reliability compared to cloud providers with a more generic focus,” Intrator said.
The fresh funding CoreWeave secured last week brings its total capital raised to $371 million and the company’s valuation to $2 billion, Intrator said.
Asked how it was able to secure such a chunk of change in an environment where venture capital funding is becoming increasingly scarce, Intrator pointed to the company’s longstanding relationship with alternative asset manager Magnetar Capital.
“Our partnership with Magnetar from early in the company’s history meant they know our business well and understand our vision. The participation of new investors NVIDIA, Nat and Daniel, reflects the growth potential in the space,” he said. “We were expanding rapidly before the generative AI boom, but the increased demand for the types of specialty workloads CoreWeave can manage has certainly added rocket fuel to our growth.”
The money will be used further expand CoreWeave’s niche infrastructure and support the launch of two new data centers in the U.S. in Portland, Oregon and Atlanta, Georgia. Following the expansion it will have a total of five data centers in North America, Intrator said.
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