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

A standard funding round gives a startup access to capital for growth initiatives. In secondary sales, the proceeds go to the startup’s shareholders. Such transactions are often used to give employees and early investors a chance to offload some of their equity before an initial public offering.

CoreWeave’s secondary sale 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 deal reportedly values CoreWeave at $23 billion, which is $4 billion more than what it was worth after a funding round in May.

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

CoreWeave is planning to build 10 more data centers next year. This past June, it allocated $2.2 billion to launching three data centers in Norway, Sweden and Spain. It announced plans for two U.K. facilities a few weeks earlier.

CoreWeave’s data centers are equipped with AI clusters that each include 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 one generation behind Nvidia’s latest Blackwell B200 graphics processing unit, but that product has not yet started shipping to customers in large numbers.

The H200 is an upgraded version of Nvidia’s bestselling H100 GPU. The main difference is that the chipmaker expanded the onboard memory pool and also made it faster. Because AI models move data to and from RAM much more frequently than other types of software, speeding up 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, which are likewise made by Nvidia and help speed up auxiliary computing tasks, such as managing the flow of network traffic. Meanwhile, central processing units from Intel Corp. perform the calculations not relegated to the instances’ Nvidia-made silicon.

The secondary sale announced today could be one of CoreWeave’s last private financing deals before going public. Earlier this month, Bloomberg cited sources as saying that the cloud provider plans to float its shares in 2025. The investment banks that CoreWeave has hired to manage the listing reportedly include Morgan Stanley and Goldman Sachs, which managed its secondary sale. 

Image: CoreWeave