CoreWeave's Fantastic Voyage: Starting from Ethereum Mining, Transforming into an AI Computing Powerhouse with a Valuation Exceeding $2 Billion
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CoreWeave's Fantastic Voyage: Starting from Ethereum Mining, Transforming into an AI Computing Powerhouse with a Valuation Exceeding $2 Billion
In today's era of scarce computing power, CoreWeave has become a highly sought-after asset. Backed by NVIDIA, CoreWeave faces almost no competition in the high-performance AI computing field.
Navigating Web3 tides with focused insightsBy: TechFlow Cleaner
Who knew graphics cards could be used as collateral for loans!
In early August, GPU-accelerated cloud service provider CoreWeave recently secured $2.3 billion in debt financing—approximately 16.5 billion RMB—using its stockpile of NVIDIA H100 GPUs as collateral.
The funding round was led by Magnetar Capital and Blackstone, with participation from BlackRock, PIMCO, Carlyle Group, Coatue, and DigitalBridge. Prior to this, CoreWeave had raised $421 million and was valued at over $2 billion.
This is a remarkable company. Originally founded as an Ethereum-focused cryptocurrency mining operation, it unexpectedly pivoted to become a cloud computing service provider powered by NVIDIA GPUs. Then, in 2023, it rode the AI boom to land major clients like Microsoft, quickly rising into the unicorn ranks.
This article traces the journey of CoreWeave’s rise.
From Mining Beginnings
In 2016, out of curiosity and passion, CoreWeave’s founding team—three commodity traders: CEO Michael Intrator, Chief Strategy Officer Brannin McBee, and CTO Brian Venturo—bought their first GPU, plugged it in, placed it on a pool table overlooking the East River in Lower Manhattan, and mined their first block on the Ethereum network.
Soon, mining turned into both a hobby and a business.
With some early small investments from friends, CoreWeave moved its mining operations from a pool table to a garage (a makeshift data center) in New Jersey. Shortly after, they decided to go all-in, officially founding Atlantic Crypto—the predecessor of CoreWeave.
As a mining company, their core production asset was GPUs. During the 2018–2019 crypto winter, when many mining firms collapsed, they seized the opportunity to buy up GPUs at rock-bottom prices. Their inventory grew from hundreds to tens of thousands, and their data centers expanded to seven locations.
During the bear market, they began offering GPU cloud servers to other miners. Soon, they discovered a growing demand: numerous enterprises relying on GPU acceleration approached them for computing power. These companies shared a common pain point: traditional cloud providers offered limited compute options and monopolistic pricing, making large-scale expansion extremely difficult.
Thus, in 2019, CoreWeave launched a new business line, providing its GPU cloud infrastructure to enterprise developers—for tasks such as CG rendering, which became their primary early revenue stream.
According to CoreWeave’s official website, their solutions—from servers to storage and networking—deliver speeds up to 35 times faster and at 80% lower cost than general-purpose public clouds.
In 2021, CoreWeave completed a $50 million funding round. At the time, while primarily offering cloud services, they also utilized idle customer computing power for Ethereum mining.
By 2023, with the explosive popularity of ChatGPT and the dawn of the AI wave, CoreWeave truly entered its golden era.
In April, the company raised $221 million in Series B funding, followed by a $200 million extension in May, bringing total funding to $576.5 million.
Aligned with NVIDIA
According to disclosed financing details, NVIDIA participated in CoreWeave’s Series B round. While the exact investment amount wasn’t revealed, the message was clear: CoreWeave now had a big brother—NVIDIA.
And the big brother has been generous.
According to The Information, despite severe shortages of NVIDIA’s H100 chips, NVIDIA allocated large quantities to CoreWeave while restricting supply to Amazon and Google.
In September last year, CoreWeave became NVIDIA’s first Elite-level Cloud Service Provider (CSP), offering AI, computing, and visualization services. CoreWeave also deployed NVIDIA InfiniBand and BlueField DPUs in its cloud infrastructure—InfiniBand delivering end-to-end high-performance networking for scientific computing, AI, and cloud data centers, while BlueField DPUs enhance efficiency across computing infrastructure.
In July, CoreWeave partnered with NVIDIA to train the GPT-3 large model using H100-based cloud services—completing the task in just 11 minutes. By contrast, OpenAI took 14.8 days using 10,000 A100 GPUs.
Market analysts widely believe that CoreWeave earned NVIDIA’s favor because, unlike other cloud providers, it relies entirely on NVIDIA chips and has no intention of developing in-house alternatives like Google or other tech giants. This makes NVIDIA eager to support and strengthen the partnership.
In today’s world of scarce computing power, CoreWeave has become a highly coveted player. Backed by NVIDIA, it faces virtually no competition in the high-performance AI computing space.
In June this year, to ensure sufficient computing power for the future development of ChatGPT, Microsoft signed a multi-billion-dollar AI computing agreement with CoreWeave.
CoreWeave founder and Chief Strategy Officer Brannin McBee stated, "CoreWeave generated $30 million in revenue last year, will reach $500 million this year, and has already secured nearly $2 billion in contracts for next year."
Additionally, CoreWeave aims to establish a strong presence in industries such as life sciences—including drug discovery, protein folding simulations, molecular research, and genetic testing. During the 2020 pandemic, CoreWeave contributed the computing power of 6,000 GPU miners to Stanford University’s coronavirus research initiative, helping analyze the virus and potential treatments.
McBee added, “Walking into our data centers is awe-inspiring. I’ve been building computers since childhood. To now be part of a company that builds and scales computing infrastructure, delivering powerful computing to some of the coolest companies on the planet—it’s truly fascinating.”
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