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CoreWeave raises $2.3 billion in debt collateralized by Nvidia chips (www.reuters.com)

submitted 1 year ago* (last edited 1 year ago) by ijeff@lemdro.id to c/technology@lemmy.world

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cross-posted from !aistuff@lemdro.id

CoreWeave, a company that provides cloud services, has secured a $2.3 billion loan using Nvidia chips as security.

This large loan reflects a growing trend of securing loans with physical assets, especially when banks aren't lending as much.

CoreWeave has grown quickly thanks to a boom in AI. It has special access to Nvidia chips, which gives it an advantage over big cloud providers like Microsoft, Amazon, and Google.

CoreWeave will use the loan to buy more chips, build data centers, and hire more staff. It's aiming to have 14 data centers in the U.S. by the end of the year.

Earlier this year, CoreWeave also raised $421 million in equity, pushing its value to over $2 billion.

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[–] bernieecclestoned@sh.itjust.works 10 points 1 year ago

So, they are raising debt secured on chips to buy more chips

Infinite money glitch

[–] autotldr@lemmings.world 6 points 1 year ago

This is the best summary I could come up with:

Aug 3 (Reuters) - Specialized cloud provider CoreWeave has raised $2.3 billion in a debt facility led by Magnetar Capital and Blackstone (BX.N) and collateralized by Nvidia chips, with the funds to be used to expand to meet rising AI workload, the company said on Thursday.

Nvidia-backed CoreWeave has seen a boost from the generative AI boom thanks to its purpose-built cloud infrastructure at scale.

The company has unique access to the most advanced Nvidia chips that are in short supply, giving it an edge in competition with traditional cloud providers like Microsoft (MSFT.O), Amazon (AMZN.O) and Google (GOOGL.O), which are facing supply restraints while working on developing their own chips.

The new financing will be used to acquire more graphics processing units, invest in data centers and hiring, the company said.

It announced an $1.6 billion data center in Texas last week and aims to expand to 14 in the U.S. by year end.

CoreWeave also raised $421 million in equity this year led by Magnetar Capital at a valuation of over $2 billion.

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