MW What is CoreWeave, the cloud-services provider expected to go public next week?

By Therese Poletti

CoreWeave was founded as a crypto-mining company but pivoted into AI cloud services

CoreWeave is heading toward a much-anticipated initial public offering as soon as next week, which will give investors another way to play the boom in artificial intelligence.

The company develops data centers designed to run AI applications, and it currently operates 32 of them across the U.S. and in Europe. Those are running more than 250,000 graphics processing units, the bulk of which come from Nvidia Corp. $(NVDA)$. The chip giant is also one of CoreWeave's biggest investors, with a 6% stake, and CoreWeave is considered an Nvidia partner, with early access to its newest-generation GPUs.

As a data-center provider, CoreWeave counts among its clients some other hyperscaler companies that don't have enough computing power to meet the growing demand for AI. CoreWeave has developed an entire platform dedicated to maximizing AI workloads with the most advanced hardware in its data centers, including high-performance networking and cooling technologies.

The company, like many in the AI space, has a customer concentration that could be a bit worrisome to investors. In its prospectus, it noted that about 77% of its revenue was from its top two customers in 2024. Microsoft Corp. $(MSFT)$, its largest, accounted for 62%.

On Thursday, the Financial Times reported that Microsoft has moved away from some of its agreements with CoreWeave. But the company refuted the report. "We pride ourselves in our client partnerships and there have been no contract cancellations or walking away from commitments. Any claim to the contrary is false and misleading," CoreWeave said in an emailed statement.

A spokeswoman declined to comment on the upcoming IPO or its timing.

Reuters reported that CoreWeave could be valued at upwards of $35 billion after its deal. Bloomberg News reported last month that the company was aiming to raise roughly $4 billion.

Also read: Cerebras IPO filing points to a recurring concern in AI: customer concentration

In addition to its customer concentration, CoreWeave also has supplier concentration, with a limited number of suppliers of its components. "Any disruption in the availability of these components could delay our ability to expand or increase the capacity of our infrastructure or replace defective equipment," CoreWeave said in its prospectus.

Mark Klein, chief executive of SuRo Capital Corp. $(SSSS)$, a publicly traded venture-capital fund, said his firm invested in CoreWeave because of its huge growth and customer relationships, which are contractual. CoreWeave's revenue grew from $16 million in 2022 to $229 million in 2023 and to $1.9 billion in 2024.

"They have $15 billion in contracted revenue now," Klein said. "So you could look at this business and see it is growing at an extraordinary rate. ... It wasn't one of those projections that everyone sees a hockey stick. This was real contracts." Klein said that SuRo Capital invested $25 million in CoreWeave, the biggest investment since the fund's founding in 2013.

Klein also described the company's management team as "really smart guys" and emphasized the strong ongoing relationship with Nvidia as another major positive.

But as CoreWeave's revenue has grown, its losses have as well. The company lost $863.4 million in 2024, whereas it posted a net loss of $593.7 million in 2023 and $31.1 million in 2022.

CoreWeave was founded by three former Wall Street hedge-fund managers and traders - Michael Intrator, Brian Venturo and Brannin McBee - who specialized in natural gas and other energy investments. Like some Silicon Valley startups, the company was founded in a garage, but with a twist - it is based on the East Coast, in suburban New Jersey.

In 2017, it began as a crypto-mining company, after its founders built a system to mine Ethereum as a hobby. In a 2023 interview with the Wall Street Journal, Intrator, who is the company's chief executive, said that the system he and Venturo had set up with GPUs from Nvidia made their Wall Street office feel like a sauna on summer weekends without air conditioning. They moved their hardware, which at at one time had been set up on a pool table in a lower Manhattan office, to Venturo's grandfather's garage in New Jersey.

Initially the company was called the Atlantic Crypto Corporation. It became CoreWeave in 2019 after crypto prices crashed. The co-founders were looking for less volatile areas for their computing power and saw opportunity in AI, even before the ChatGPT era.

Despite the fears about customer concentration and supply concentration and jitters about when the AI spending boom might come to an end, the upcoming deal is attracting attention. As Klein pointed out, there are over a dozen investment banks listed in the prospectus, including top-tier Wall Street bankers. The deal is also going to be closely watched as a barometer of the overall IPO market.

"If CoreWeave goes out and gets done, people will feel like the IPO market is opening up," Klein said, adding that the company did not waver after its initial filing earlier this week, even in the face of market turmoil. "They were comfortable filing the day of the tariff news when the market collapsed. They were obviously getting good feedback from the road," Klein said.

-Therese Poletti

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March 06, 2025 15:10 ET (20:10 GMT)

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