CoreWeave Inc., the operator of a cloud platform optimized for artificial intelligence workloads, today announcement that it completed a $650 million secondary sale.

A standard funding round gives a startup access to capital for its growth initiatives. During secondary sales, the profits go to the startup’s shareholders. Such transactions are often used to give employees and early investors the opportunity to shed some of their equity before an IPO.

The secondary sale of CoreWeave was led by Jane Street, Magnetar, Fidelity Management and Macquarie Capital. They were joined by Cisco Investments and Pure Storage Inc. as well as a number of financial institutions. The agreement would have values ​​CoreWeave at $23 billion, $4 billion more than it was worth after a May funding round.

Between the two rounds, the company secure a $650 million credit line from more than half a dozen banks. CoreWeave is using the billions of dollars in equity and debt financing it has raised since its launch to build a vast network of AI-optimized data centers. The company has set a goal of ending the year with 28 cloud installations, double the number it operated at the end of 2022.

CoreWeave plans to build 10 additional data centers next year. Last June, it allocated $2.2 billion to launch three data centers in Norway, Sweden and Spain. It announced plans a few weeks earlier to build two facilities in the United Kingdom.

CoreWeave’s data centers are equipped with AI clusters each comprising up to tens of thousands of Nvidia Corp. graphics cards. In August, the company became the first cloud provider to launch instances powered by the chipmaker’s H200 processor. The chip is a generation behind Nvidia’s latest Blackwell B200 graphics processing unit, but that product has yet to begin shipping in large numbers to customers.

The H200 is an upgraded version of Nvidia’s best-selling H100 GPU. The main difference is that the chipmaker has expanded the onboard memory pool and also made it faster. Since AI models move data to and from RAM much more frequently than other types of software, accelerating a GPU’s memory can significantly improve workload performance.

CoreWeave’s H200 instances combine the GPU with several other chips. There are Bluefield-3 processors, also made by Nvidia, that help speed up auxiliary computing tasks, such as managing the flow of network traffic. Meanwhile, Intel Corp.’s central processing units. perform the calculations that aren’t relegated to Nvidia-made silicon.

The secondary sale announced today could be one of CoreWeave’s final private financing transactions before its IPO. Earlier this month, Bloomberg Cited sources say the cloud provider plans to list its shares publicly in 2025. Investment banks that CoreWeave has hired to manage the listing reportedly include Morgan Stanley and Goldman Sachs, which handled its secondary sale.

Image: CoreWeave