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Data centre start-up Crusoe Energy is raising as much as $500mn of equity capital from investors including Peter Thiel’s Founders Fund to expand its facilities that provide the infrastructure powering the AI boom.
The fundraise will value Crusoe at about $3bn, more than double its valuation two years ago, according to three people with knowledge of the deal. It is the latest fledgling company whose fortunes have surged as a result of the significant spending on AI following the release of ChatGPT in late 2022.
Founders Fund, which has invested in Crusoe since its seed round in 2019 and was also an early backer of OpenAI, will lead the new funding round, according to three people close to the deal talks. Felicis Ventures, another existing Crusoe investor, will also participate, the people said.
Crusoe is among a fast-growing group of start-ups in a burgeoning industry of “neoclouds” — data centre companies that provide outsourced cloud computing for other tech groups to build AI.
The industry has attracted vast financial backing from Silicon Valley and Wall Street investors to fund the acquisition of tens of thousands of Nvidia’s powerful AI chips — known as graphics processing units. These can be placed in data centres and leased to tech companies such as Microsoft and Meta. CoreWeave, the largest neocloud company, has raised more than $12bn in debt and equity over a series of deals in the past 18 months.
Crusoe’s investment round comes at the same time as it announced it had signed a $3.4bn deal with Blue Owl Capital earlier this month, an alternative asset manager, to finance construction of a new data centre in Texas. The facility will be leased to Oracle, which has a deal to provide computing power to Microsoft and OpenAI.
Venture capital firms have rushed to invest in a technology many believe will be as significant as the internet or mobile technology. More than 40 per cent of the $93bn spent by VCs in the first half of this year went to AI start-ups, according to private markets data company PitchBook.
The clamour to back cutting-edge AI models, such as OpenAI, Elon Musk’s xAI and Anthropic, has rapidly pushed up their valuations, with OpenAI priced at $150bn earlier this month. Many venture funds are instead looking at investing in either infrastructure to support AI, or applications which use it, in the hope they can find better value deals.
Crusoe was founded by quantitative trader Chase Lochmiller and energy investment banker Cully Cavness in 2018 to set up data centre modules that could harvest waste gases from oilfields and use them to power energy-intensive computing such as bitcoin mining and AI. The company switched its focus to creating more permanent data centre facilities in around 2020, acquiring large volumes of AI chips from Nvidia and leasing its cloud computing technology to companies building AI models.
Late last year, Crusoe raised $200mn in debt using its chips as collateral from New York investment firm Upper90. The capital was used to buy thousands more of Nvidia’s H100 GPUs.
Crusoe, Founders Fund and Felicis Ventures declined to comment.
